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The True Cost Of Small Business Group Health Insurance

What is Group Health Insurance?

Group Health Insurance is a selected plan that provides health care to a predetermined, select group of people. These health insurance plans are generally uniform in policy offering the same health care coverage to all employees or members of the group.

Is Group Health Insurance a Good Investment For My Small Business?

The answer to that is in short: No.
Why?

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Posted by lschultz in Health Insurance, Small Business

The Question Presidential Candidates Must Answer

The Affordable Care Act (ACA) seems to be a topic of discussion for Presidential candidates. Will the ACA still presidential candidatestay intact once the next President is elected into office? What changes will be made to the ACA? The biggest question stated by an article on Bloomberg View is, “How would they (Presidential Candidates) protect people with pre-existing conditions? Left to their own devices, after all, insurers have an incentive to charge higher premiums to potential customers who already have chronic health conditions – or not to offer them coverage at all.”

What the ACA has done well is to ban the refusal of coverage for individuals with pre-existing conditions. To protect the insurance providers the ACA has required ALL individuals and families to obtain coverage. This prevents those that are healthy from only enrolling in healthcare when something goes wrong, then dropping coverage once they are well again. Otherwise premium rates would skyrocket. It’s taking the good with the bad so that everybody is able to obtain coverage.

Several conservative plans offer a different option and still help people with pre-existing conditions as well as provide better options to healthy individuals. The proposal provides tax credits to help those who don’t have employer coverage, requires insurers to offer the same terms for sick and healthy as long as they are continually covered, and creates high-risk pools for anyone else. There are also ideas of rewarding those with continual coverage with protection from premium increases.

Many of the proposed options are trying to remove most of the federal spending and regulation. Bloomberg View states later in the article, “One could expect the need for the high-risk pools and the regulatory protections to diminish. They address problems that in large part result from the way federal and state policies have stunted the growth of the individual market.” All of the proposals on the table focus on allowing a more functional market to emerge. I’m looking forward to seeing the changes and how the ACA will develop with a new POTUS in office!

Read the full article on Bloomberg View HERE

 

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , , ,

Goodbye Employer Provided Health Insurance

health insuranceAn article from Market Watch highlights Rick Lindquist and Paul Zane Pilzer, co-authors of “The End of Employer-Provided Health Insurance.” The book goes over why group health insurance is a thing of the past and why individuals, their families, and their employers are all benefiting from moving away from group health insurance options.

Group health insurance rates continue to rise and that’s where Zane Benefits steps in. Zane Benefits is not a health insurance company, but a company that administers defined-contribution plans. What is that you might be asking? It is a benefit plan that gives employees a set amount of money each month that they can use for reimbursement of their health insurance premiums. This plan allows employees to have choice in selecting their health insurance plan. The employer is removed from the selection and allows the employee to shop for an insurance plan that custom fits them and their family.

In Lindquist and Pilzer’s book they project that by 2017, the majority of small businesses will switch to defined-contribution. This shift is being led by small business owners, but they aren’t the only ones dropping health insurance and looking for other options. Verizon and AT&T leaked documents saying they were considering dropping health insurance plans as well.

With the potential savings benefit of this plan why wouldn’t all companies choose this option. Well simply said, you don’t know what you don’t know. Companies don’t understand how a defined-contribution plan could benefit them, not only savings on the part of the employer and the employee, but also helps employee retention as well. What employee wouldn’t want to choose their own health insurance rather than have somebody choose for them?

Read the full Market Watch article HERE and let me know if this is an option you would look into for your company!

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Posted by Lauren Yeager in All Posts, Health Insurance, Small Business and tagged , , , , ,

Healthcare Cost Keeps Rising

Healthcare cost continues to rise and the Affordable Care Act (ACA) isn’t exactly affordable at all. The inflation of healthcare is rising faster than the American economies natural inflation rate. What is making healthcare rise faster than everything else? There are many contributing factors and one of the major ones is supply and demand. The demand for healthcare didn’t happen organically, it happened over night. When the ACA was passed the entire United States population had demand, but the supply stayed the same. Sadly the healthcare provider market hasn’t expanded much in response to the demand.

There are some new health insurance carriers that are trying to hedge their way into the market, but the successful ones get bought out by the larger more established companies. The inflation for healthcare is not just attributed to supply and demand though, it is also the result of political decisions and increased regulations as well as the cost of prescriptions, medical devices, and hospital care, according to an article on Forbes. Some of these were already an issue to rising healthcare costs before the ACA was passed, so why did congress put a 2.3% tax on medical devices under the ACA’s law? Doesn’t make much sense when you are trying to keep healthcare cost “affordable.”

Here is a graph that we pulled from Forbes comparing the natural rate of inflation against the healthcare rate of inflation. Will healthcare increases outrun our incomes if more competition doesn’t halt the monopolized lack of supply for the ever increasing demand? What are your thoughts on healthcare costs?

healthcare cost
Read the full Forbes article HERE

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , ,

Medicare Isn’t Sustainable

During a New Hampshire town meeting Jeb Bush was confronted by a senior citizen after a comment about entitlement reform. The women commented by saying, “My Medicare right now is wonderful and I paid into it for all these years. Why are you always attacking seniors?” Where Bush called it the entitlement system the woman rebutted that she had earned it.

I can see where the woman is coming from in the thought that she has paid into the system, and she has, but not nearly enough to contribute to the cost of her medical care. The level of funding is not adequate to support the current and future Medicare participants. It is expected that the Medicare fund will be insolvent by 2026 . According to Grace Marie Turner, “At best, she will have paid for less than half of the expected cost of her lifetime Medicare expenditures and possibly as little as 8%. Medicare is not sustainable as it is currently structured, and reform is indeed vital.” Take a look at this graph on the cost versus what is actually paid.

Medicare
As you can see the benefits received far outweigh what was “paid for” and as a common misconception of those currently receiving Medicare it’s a hard issue to reform. As time goes on with the cost of inflation the difference continues rise. This will be an issue that will have to be looked at in the upcoming Presidential term. Have you previously thought that Medicare is completely covered by what you have paid into over your working years? Do you agree that we need reform to the Medicare system?

Read the full article from Grace Marie Turner HERE

 

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , ,

Good Decisions For Small Business Healthcare

Under the Affordable Care Act (ACA) a small business above 50 employees is required to provide healthcare for healthcaretheir employees. These companies that have 50 or more full-time employees must provide health insurance to 95% of their employees and dependents up to age 26 or risk paying a tax penalty of $2,000 per full-time employee. An article on Forbes says, “many small businesses still do provide health care for their employees, either out of a sense of responsibility or out of a desire to attract quality candidates (or both).” Although, depending on how those plans are paid for you could run into some trouble.

Kelly Phillips Erb a writer for Forbes goes over ways to make the best choices as a small business to avoid that trouble. She states, “If it doesn’t make good fiscal sense for you to provide health insurance coverage for your employees, or if the coverage you do provide is less than ideal, consider setting up an additional health benefits plan. A Section 105 plan…allows tax-free reimbursements for expenses.”  She also goes on later to recommend using a broker and lists the benefits.

The biggest issue is that companies aren’t informed of their options and there ARE options. It is no longer just the black and white opt in or opt out group plans available to businesses. As a company are you informed of the different options available to you? Is your current situation still affordable? Let me know and in the meantime look at the recommendations from Kelly’s article on Forbes HERE

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Posted by Lauren Yeager in All Posts, Health Insurance, Small Business and tagged , , , ,

The ACA Boasts Fewer Uninsured

The Affordable Care Act (ACA) has boasted an increase in healthcare enrollment, which is to be expected as it’s Uninsuredmandatory. What do those numbers look like on paper though? In Colorado alone the uninsured have been cut by more than half over the past two years. The disheartening news is that the drop is due almost entirely to a surge in Medicaid enrollment, according to Biz Journals.

The Colorado Health Institute (CHI) and The Colorado Trust released its findings from the 2015 Colorado Health Access Survey and the increase in Medicaid enrollment was one of many things the survey revealed. Another is the way that Coloradans are buying health insurance. In a once employer-sponsored dominant healthcare market it showed 42,000 fewer workers receiving health insurance from businesses of 50 or fewer employees. This is a drop of 12% from the previous year. I’m not a betting woman, but I am betting this is due to the rising cost of employer-sponsored insurance and the fact that the ACA does not require companies that employee less than 50 to offer insurance. “That does not mean that fewer small-business employees are insured, however, as many of those workers have moved from group insurance plans to individual plans or to Medicaid, whose eligibility levels were expanded by the state in 2014”, said Michele Lueck, CHI president and CEO.

Ned Calonge, president and CEO of the Colorado Trust said, “The first big intent of the Affordable Care Act was to expand coverage. It’s achieved that. Those next pieces need the coverage piece to happen in order to work on that. We’re exactly where we need to be.” The numbers are there for individuals who are enrolled in healthcare, but now the number of under-insured individual’s needs to be looked at.

All in all the ACA has done well as its first goal was to insure Americans that were uninsured or under insured. What other areas of the ACA do you see that need to be fine-tuned?

Read the full article on Biz Journals HERE.

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , , , ,

Pro or No Vaccine?

vaccinateThe battle continues from parents on Pro or No Vaccine. As the school year starts there are many children walking through the doors without their recommended vaccines due to medical, religious or philosophical reasons. Parents who are pro-vaccine believe that those that don’t vaccinate their children are putting their children at risk. Please inform me of something though, if their children are vaccinated they are no longer at risk, so why are they worried? It is the parents that don’t vaccinate their children that are putting each others children at risk and they all sit on the same side of the fence, so why the big issue?

The Centers for Disease Control and Prevention (CDC) suggests vaccination schedules for children and adults but there are no federal requirements. All states have their own policies to require children to be vaccinated, but parents are able to obtain exemptions. After a large outbreak of measles that originated at Disneyland in California those that don’t vaccinate have come under more ridicule. California and Vermont have now taken away the choice of parents to exempt their children for religious or philosophical reasons.

The possible excuse of not having or not being able to afford healthcare is eliminated as well due to the Affordable Care Act (ACA). Preventative care is typically covered at no cost to the individual and includes routine vaccinations against diseases. The CDC puts out a recommended vaccination list for all ages and can be found HERE. If it is an issue of healthcare coverage I urge you to look into health plans for your family to ensure that your family is protected if you desire to be.

If you are one that is anti-vaccination let me know, why do you choose not to vaccinate your child? If you do vaccinate your child please tell me, what are your thoughts on those that don’t and why you choose to vaccinate?

 

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , , ,

HSA for Retirement

Open Enrollment for 2016 healthcare plans are around the corner and we don’t want you to miss the benefits that a HSAHealth Savings Account (HSA) can offer you. An HSA is a tax-exempt trust of custodial account that can be set up to pay for future medical expenses. This type of plan is incredibly beneficial who are looking to save money for retirement and here is why.

HSA accounts allow you to put tax deductible contributions into your account up to $3,300 for an individual or $6,550 for a family. If you were 55 or older in 2014 you can add an additional 1,000 dollars to each of those numbers. The money you contribute accrues interest and the earnings are tax-free and you are able to pay for your qualifying medical expenses out of that account also tax-free. This can be a wise way for both older and younger individuals looking to invest, that know their investment capital is around the maximum contribution allowed or less. If the ability to contribute more than the maximum contribution amount you might want to look at an IRA instead.

Another great bonus to an HSA account is that the funds remain in your account year after year even if you do not use them for medical expenses that year. Once you hit retirement age you can withdraw those funds tax-free even if you are not using the funds for a medical expense. The stipulation to have an HSA is that you must be enrolled in a high deductible health plan. That said in order to take advantage of the tax breaks this plan works best if you are relatively healthy and have low medical expenses. It can also save you money on taxes if you are spending significant dollars annually on healthcare.

This year when you are looking at plans for yourself or your family make sure to ask your broker about Health Savings Accounts and if it would be a wise choice for you. Are you already familiar with HSA’s or is this something new for you?

Read the full article on U.S. News HERE

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Posted by Lauren Yeager in All Posts, Did You Know?, Health Insurance and tagged , , ,

1/3 The Healthcare Providers?

In a recent Washington Post article it was reported that, “Consumers who bought insurance on the health exchanges last year had access to one-third fewer doctors and hospitals, on average, than people with traditional employer-provided coverage” This is not necessarily a negative though as the smaller networks are typically negotiated contracts with the healthcare provider to offer lower costs which results in a lower premium price.

Healthcare Providers
An analysis by Avalere Health said, “Compared with traditional employer coverage, exchange plans had networks with 42 percent fewer cancer and cardiac specialists; 32 percent fewer mental health and primary-care doctors, and 24 percent fewer hospitals.” As stated above the negotiated contracts between healthcare providers and insurance carriers helps control cost. There are plans on the healthcare exchange that provide broader networks, but you are paying for that network in higher premium.

The real issue is not that the network is small, but whether a doctor stays on the network for the entire calendar year. At Design Health we have seen instances where an individual signs up for their health plan in January and their doctor is in network, but by March the doctor has ended their contract and is no longer participating in that network. Unfortunately a consumer is locked into their health plan for the calendar year, unless there is a qualifying event, whereas the healthcare provider can jump ship.

Often times consumers are informed of the network access their health plan provides and understand that there are both in and out of network providers. When the consumer is informed they go to great lengths to make sure their provider is in-network so they do not end up with a full out of pocket payment for services. Although, for those not informed they believe they can go to any doctor because they have insurance. In this instance it doesn’t matter if the network is narrow or broad, if a consumer doesn’t do their research they run the risk of paying much higher prices.

Are you a consumer that understands your healthcare network? When you enrolled in healthcare did you make sure that your doctors were included in the health plan you chose?

Read the full article from the Washington Post HERE

 

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Posted by Lauren Yeager in All Posts, Health Insurance, In The News and tagged , , , ,