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NJ Blue Cross Withdraws For Profit Application
May 24th, 2011 | 
Author: Horizon Blue Cross and Blue Shield, a New Jersey based medical insurance carrier, announced that it is no longer seeking to attain “for profit” status from the state of New Jersey.
Citing recent Health Care Reform changes and an ever growing acrimonious medical insurance environment, Horizon sent a letter retracting its application to acquire for-profit status to the New Jersey Department of Banking and Insurance (DOBI) and Attorney General’s office.
Horizon has been trying to go for-profit since the summer of 2008, but according to the letter of retraction, the carrier says “circumstances have changed, including, without limitation, that Horizon’s business operations are being redesigned in order to comply with the complex requirement imposed under the federal Patient Protection and Affordable Care Act (PPACA).”
According to Tom Vincz, public relations manager for the company, Horizon is expected to undergo “major” changes to its business in the next few years in relation to servicing its members, selling products, managing networks and interacting with federal and state governments.
The DOBI had no comment on Horizon’s withdrawal, but given that it’s been reviewing the application for nearly 3 years, there is wonder if they were ever planning to move forward with the application at all.
What does this mean to you? Well Horizon has taken a very cautious approach to Health Care Reform all along and some of our clients have been very disappointed with the direction the company has taken, citing service issues and a generally bad attitude when they call in to get help.
As an agent, we have had equally difficult times getting issues resolved. Horizon forces us to call a 3rd party to answer even the simplest of questions so we have wondered how committed they are to growing their market share with such an illogical service model.
Horizon’s competitors in the small group market, including Oxford Health Plans and Aetna Health, have continued to offer direct support, making us as agents, more inclined to steer clients in their direction, knowing we will be able to manage any issues that come up for them.
If you have Horizon Blue Cross and want to explore whether they are the carrier for you, please call Small Business Benefit Solutions, LLC and we’ll review your plan and your needs at no cost or obligation to you.
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IRS Delays Small Business Deadline for W-2 Reporting of Health Insurance Benefits
The Internal Revenue Service will give small businesses more time to comply with a health care reform provision that requires them to report the cost of health insurance benefits on their employees’ W-2 Forms.
But last year, the IRS waived that requirement for 2011 and said the health insurance reporting mandate would be pushed back and additional year and apply to 2012 W-2s, which are issued in 2013.
Under IRS Notice 2011-28, released on the 29th or April, 2011, employers that issue fewer than 250 Form W-2s in tax year 2011 will not be required to report health coverage costs on their 2012 W-2s.
Those employers “will not be required to report the cost of health coverage…prior to January 2014. This transition relief will continue until the issuance of further guidance,” the IRS said.
In addition, the IRS also clarified that the reporting requirement does not apply to retirees receiving health care coverage but no longer receive wages or salary.
Small Business Benefit Solutions, LLC was assuming that this reporting requirement would later lead to taxation of health insurance benefits.
As employers were going to be required to pay for 75% of their employees coverage in 2014 under the present Health care reform plan, the tax implications of health insurance benefits were going to spike in 2015, leading to a possible boom in taxable income.
With present budget shortfalls, this could be a large untapped source of income for the government, as well as the push towards a single payer system that is highly touted by the present Democratic caucus.
Why Covering Pre-Existing Conditions Will Bankrupt US Medical System
According to Dr. Jane M. Orient, executive Director of Association of American Physicians and Surgeons, the Health Care Reform mandate for insurance companies to cover pre-existing conditions will bankrupt the medical system, whether it’s the health insurance companies footing the bill or the US government, via we the taxpayers.
But according to Dr. Orient, the disagreeable truth—a relentless law of economics—is that you can’t insure a pre-existing condition. If your house burns down, you can’t run to your local broker and buy a policy to get the house rebuilt. The same is true if you wreck your car. If you don’t carry the proper insurance policy, you will have to borrow money from a bank or friends to pay to rebuild your house or buy another car. Seems simplistically logical, right?
People would very much like the “right” to buy insurance that would cover their pre-existings, without restrictions or waiting periods. But the same folks don’t much like the idea of paying for other people’s sicknesses. So the healthy ones often switch into a new policy that gives them an enticing low rate if they pass the underwriting. Then those who can’t switch see their premiums go up rapidly. Dr. Orient calls this the “death spiral.” And the insurance companies are often blamed while they are nothing other than a product of economics.
You might naturally feel sympathy toward a person who finds out that he has a costly and fatal condition like AIDS. But what if he doesn’t tell the life insurance company about the pre-existing as he buys a million-dollar policy for the benefit of his partner? Is it wicked of the insurer to rescind the policy because of fraud? Or should the government force the company to pay—until it goes bankrupt, and leaves all of its other policy holders without coverage?
If you have insurance through your employer, pre-existings are likely not a problem—if you can get the job, that is. But the huge drawback of employer-owned insurance is that you lose it if you lose your job. This is called “job lock.” Lots of people are stuck in jobs they hate because of this.
It might not seem fair that people who pay into a policy for years or decades are left with nothing the instant the policy lapses. But that is the nature of an insurance contract.
If over 10 years or so, you put $100,000 into a safe investment, at the end of that time you have $100,000 plus interest. If instead you hand the money over to the insurance cartel, you have nothing. The trade-off is that if you have a catastrophic event during the time you are covered, the insurer pays. Most people think the deal is a fair one, and that’s why they voluntarily pay the premiums.
As soon as the government forces people to pay a premium for other people’s pre-existings, they are likely to object to what they—quite reasonably—see as a rip-off. Hence the need for more force: the individual mandate.
Some people don’t see the connection, and think we can keep that popular provision on pre-existings, and delete the rest. We can’t.
The long-term answer to the problem of pre-existings is to break the connection between health insurance and employment, which requires changing the tax code provision that caused it. People can pay medical costs with pre-tax dollars if and only if they pay with employer-owned insurance. If they pay out of pocket or through individual policies, they must use after-tax dollars. With payroll tax and income taxes, that means they pay about twice as much. How can that be fair?
People tend to have much longer relationships with groups other than their employer: churches, credit unions, or fraternal organizations, for example. Why can’t they get group health insurance in that way? This type of group policy could offer advantageous guaranteed renewability to keep healthy people in the program.
And why should people get a huge tax advantage if and only if they funnel payments through a third party?
Meanwhile, there are people who have problems now. And there is a solution that already works, without the system-wide destruction of ObamaCare. Many states have high-risk pools for the uninsurable. In Colorado, the monthly premium for a 35-year-old man with income under $50,000 is about $204, around $50 higher than premiums in the regular market. In New Jersey, with guaranteed issue/community rating like that in ObamaCare, the regular monthly premium is $2,150.
Forcing insurers to cover pre-existings without allowing enormous premium increases will bankrupt them. Perhaps driving private insurers out of business is the real agenda. However, imposing a “solution” that multiplies costs bankrupts everybody.
Those who are counting on that single payer hovering in the background need to remember that the government is already bankrupt—a very dangerous pre-existing condition.
The most popular provision of ObamaCare may also be the worst. The whole Act needs to be repealed.
Anthem BC/BS Billing Issues for Jan. & Feb. for Individuals
New Hampshire Individual Customers Billed Incorrectly
Due to a system error, the monthly premium shown on some January and February statements mailed to Individual members from Anthem Blue Cross and Blue Shield were incorrect.
Based on the annual premium rate noted in the member’s renewal letter, the amount due number shown was less than it should have been.
Anthem says they have made the necessary correections and have sent a letter to the effected members directly.
If you’re unsure what to do with your bill, follow these steps:
- If you have already paid your premiums for January and February, you will receive a new bill that shows credit for your payments made and the balance due.
- If you have NOT paid your January and February premiums, you should wait until you get a new bill with the corrected amount.
- If you use our Electronic Funds Transfer system to pay your bill, the next withdrawal will include the remaining balance due for January and the correct February premium.
- If you received a late notice because of a missing or partial January payment, you should disregard it. Their grace period will begin with their February bill.
If you have any questions, please contact Small Business Benefit Solutions, LLC, your broker or agent or you can contact Anthem directly at the phone number on the back of your ID card.
Guardian Exits Group Medical Insurance Market in NY
Guardian Life Insurance Co. of America has decided to stop offering group medical insurance in NY an has agreed with UnitedHealthcare on a plan for UHC to automatically take over it’s clients upon renewal. It is unclear whether UHC will use the Oxford platform to renew these cases yet or not.
In a memo that we received yesterday, New York-based Guardian said “its modest medical market share and its use of rental networks significantly hampered its ability to compete in the group medical sector that has frequently favored large national medical carriers” so offering the plans is no longer financially viable.
According to a spokesman, Guardian covers 42,400 employees in small group medical plans and these employer groups will have the opportunity to transition to United or to move to another local carrier.
Guardian intends to continue to offer ancillary benefits such as dental, life, disability and vision care.
If you presently have a Guardian small business medical policy at your office, call Small Business Benefit Solutions, LLC right away. Don’t wait until your renewal to make a decision about moving to another carrier. we can shop other more competitive carriers for you
MEGA Life Insurance Cancelling Group Plans in NH
The Mega Life and Health Insurance Company has announced that is will no longer offer small group health insurance in the state of New Hampshire.
The company is announcing this to it’s small group clients via written correspondence and is making the action effective upon the anniversary/renewal date of the client’s policy following a NH state required 180 day advance notice.
Essentially this means that if you’ve received a letter about termination and your policy renews within 180 days of getting the letter, ed in April, you could keep your Mega Life policy until April of 2012.
If you have received a letter from MEGA life telling you that your policy is not being renewed, call Small Business Benefit Solutions, LLC right away. Don’t wait until the end of the policy to begin searching for new coverage.
Tool To Estimate Health Care Costs NH
Thanks to the NH Department of Insurance, there is now a source that NH residents can use to help determine what a typical medical procedure will cost them.
This tool is especially useful for individuals with plans that carry deductibles and co-insurance and, while it’s certainly not an exclusive list of all medical procedures, it can give you an idea of costs for maternity care, preventive care, common ER visits, common radiological procedures and common surgical procedures..
For example, I can look at what an MRI of my knee would cost (since MRIs are commonly subject to a deductible and/or coinsurnace).
I enter my zip code, how far I am willing to travel for my MRI, specifics about my own health plan and them submit my answers. Within seconds, I am given a listing of the facilities within a radius I have chosen that offers that service, and exactly what they will bill for that service and how much of it will be my responsibility based on the parameters I have selected.
The best use of this tool will be for people who have either a high deductible HMO or PPO, or for people using a Health Savings Account plan, but remember that the tool only operates on information YOU provide. It’s not a 100% guarantee that the data will match the actual bill you receive.
Variations can come into play if your visit includes more procedures that what are listed on the site (such as an MRI with contrasting liquid versus and MRI without, or a surgery with complication, etc.), if you have already met some of your deductible in the year, or if your insurance company changes between when you do this research and when you have your procedure performed.
As always, it never hurts to contact the billing office where you are planning a medical treatment or procedure and ask them what they will bill. They will know if there is something special about what you are having done and they will know exactly what it costs.
To access the tool, please visit: http://www.nhhealthcost.org/costByProcedure.aspx
House Republicans Want Quick Repeal of Health Care Reform
Reuters is reporting that the new Congress may have a chance to overturn the unpopular Health Care Reform Legislation.
House Republicans plan to hold a vote later this month to repeal the increasingly criticized health care law and they think they have enough support to override a presidential veto of the repeal according to Michigan lawmaker Fred Upton.
“Unpopularity numbers are as high as 60% across the country,” said the incoming chairman of the House Energy and Commerce Committee, “I don’t think we’re going to be that far off from having the votes to actually override a veto”.
Democrats contend that because they still control the Senate, Republicans are wasting time.
But Rep. Upton said a big House vote for repeal could sway votes in the Senate “to perhaps do the same thing. But then, after that, we’re going to go after this bill piece by piece,” he said, by trying to block various parts of the law including an individual mandate for insurance coverage.
“We will look at these individual pieces to see if we can’t have the thing crumble,” Rep. Upton said.
Florida Democrat Debbie Wasserman Schultz told’ “Face the Nation” that she thinks people are learning more about benefits of the health care law, diminishing chances it will be defeated.
“A constituent in my district came up to me a few weeks ago and thanked me for saving her $3,000 a year because she could put her two adult children back on her insurance. That’s what the Republicans are going to be proposing to repeal this week. It’s not going to happen,” she said.
South Carolina Republican Sen. Lindsey Graham said he thinks that the fight to defund the bill will go through and that he would work “to allow states to opt out of the individual mandate, employer mandate and expansion of Medicaid.”
Either way, 2011 will shape up as a contentious year on Capitol Hill and this fight is just the beginning.
