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November Newsletter


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November Newsletter

  1. 1. Happy Thanksgiving!The Thanksgiving season allows us to reflect on the year and give thanks for the manyliberties and benefits we have as Americans and to those individuals who impact our dailylives. I am blessed and have a lot to be thankful for, including the business and friendshiprelationship we share.Wishing you and your family a Safe and Blessed Thanksgiving Holiday!MikeIn the spirit of Thanksgiving, Id like to share a few special quotes I enjoyed, and felt you maytoo............"As we express our gratitude, we must never forget that the highest appreciation is not to utterwords, but to live by them". - JF Kennedy"Let us remember that, as much has been given us, much will be expected from us, and thattrue homage comes from the heart as lips, and shows itself in deeds". - Theodore Roosevelt"May your stuffing be tasty, may your turkey be plump, and your potatoes and gravy have narya lump. Your yams be delicious, your pies take the prize, and your Thanksgiving dinner stayoff of your thighs!"- Unknown ph: (708) 845-3126 •
  2. 2. Market Trends, Surveys and StrategiesWorkplace Wellness Programs to Reduce Workers CompensationCostsSilos in Human Health Management! In years past employers would engage risk managers tocontrol workers compensation costs and human resource managers to control health plancosts. When addressing todays complex workforce, a combined effort creating an integratedapproach to controlling costs would be much more effective.This is particularly important due to: our aging workforce, which now averages 46 years old:our population working into their 60s and early 70s increasing medical care costs; increase instress related illnesses; obesity rates at an all-time high; and approximately 90 percent ofAmericans living with some chronic condition, such as diabetes, hypertension, asthma andthyroid disorders. These non-work related health issues directly increase the risk of work-related injuries. For a good read on the subject from Business Insurance Magazine click here.Public Sector NewsConsumer Driven Health Plan Effectiveness - Case Study: State ofIndianaLast months newsletter featured a study by the Manhattan Institute (Cadillac Coverage - TheHigh Cost of Public Employee Health Benefits) which reviewed some of the successs theState of Indiana had as a result of implementing a Consumer Driven Health Plan (CDHP). Acase study was conducted on the States progress by Mercer in May, 2010.The State implemented a CDHP plan in 2006, along with two existing PPO programs that weremerged into one plus an HMO. In 2007, a second CDHP was added and the HMO waseliminated. Mercers report validated sources of savings and overall experience of the twoCDHP plans compared to the remaining PPO. The CDHPs have achieved significantly lowercost than the PPO. The CDHPs will account for 90 percent of all participants in 2012.The following experience was noted in the Mercer study: ph: (708) 845-3126 •
  3. 3. The total average cost for the PPO was $12,317 compared to $5,462 for CDHP1 and $9,444 for CDHP2. The two CDHPs had combined savings of 10.7% per year and were projected to save $17-23 million for the state in 2010. Additionally, state employees and their families enrolled in the CDHPs were projected to save $7 to $8 million in 2010. Both CDHPs had lower than average age populations, but a higher average family size compared to the PPO. The actuarial values of the CDHP plans were somewhat lower than the PPO plans, meaning that employees would pay more out-of-pocket than if they enrolled in the PPO. But, the CDHPs were not significantly lower in value. Individuals who moved to either CDHP option had reduced utilization and intensity of services. There was no evidence participants in the CDHPs were avoiding care. Sources of savings came from better use of healthcare resources and more cost conscious decision making. Both CDHP plans had better outcomes when compared to the PPO for emergency room visits, outpatient visits, physician office visits, generic dispensing rate, hospital admissions and average length of stay in the hospital. To receive the full study click here.Containing Health Care Costs - Proven Strategies For Success In ThePublic SectorThe Government Finance Officers Association (GFOA), with a grant from Colonial Life,conducted independent research to identify the most innovative and effective strategies localgovernments can employ to meet the dual goals of containing costs and managing the qualityof employee health-care benefits. The study identified six primary targets: 1. Change the level of benefit provided. Modify the number of benefits offered and who they are offered to. 2. Manage participants choice of providers. Direct, or even limit, health plan participants choices to lower cost providers. 3. Share cost with employees. Structure the health plan so that employees bear an increasing part of the burden of benefit costs. Increase premiums, co-pays or deductibles. ph: (708) 845-3126 •
  4. 4. 4. Reduce use of health care services by employees. Address incentives and actual need for health care services. Consider offering Consumer Driven Health Plans. Add Worksite Wellness Initiatives. 5. Right-source health benefit services. Identify a strong network of service providers. 6. Maximize the value received for the health care dollar. Consider the benefit received per dollar spent on health benefits.To review the full report including implementation strategies, click here.Legislative Updates and ImpactsSupreme Court To Hear PPACA ChallengesOn November 14, 2011, the United States Supreme Court announced that it will heararguments relating to various constitutional challenges to the Patient Protection and AffordableCare Act (PPACA). A decision will be issued before its term ends in June 2012.The Court has agreed to review four questions that were raised in various lower courtchallenges to PPACA: Individual Mandates - Did Congress exceed its authority under the Commerce Clause of the Constitution in requiring that individuals maintain minimum essential coverage beginning in 2014 or pay a tax assessment? Severability - if the individual mandate provision is nullified as unconstitutional, is it severable from the rest of the legislation, or will some or all of the PPACA provisions be nullified? Anti-Injunction Act: Are private individuals and states procedurally barred from challenging the constitutionality of the individual mandate by the Anti-Injunction Act, which prohibits legal challenges to taxes until after the tax is collected? Medicaid: Did Congress exceed its constitutional authority in expanding the Medicaid program? ph: (708) 845-3126 •
  5. 5. Compliance Date Delayed for Summary of Benefits and Coverage(SBC)On August 22, 2011, the Departments of Health and Human Services and Labor and Treasuryissued proposed regulations for the SBC. The proposed regulations included guidance onproviding and preparing the SBC as well as a proposed template for the SBC. The regulationswere not final.On November 7, 2011, the Department of Labor (DOL) issued a set of Frequently AskedQuestions that addresses when plans and issuers must start providing the SBC. The proposedregulations called for providing the SBC by March 23, 2012. However, in the FAQ, the DOLdelays the compliance date. It now states plans and issuers can wait to start providing theSBC until after the final regulations are released. Thus, the March 23, 2012 deadline no longerapplies.More information on the SBC requirement, including the proposed regulation is available Carriers and Healthcare Providers In The NewsAetna HealthFund - Seventh Annual StudyAetna conducted its seventh annual study of their CDHP block of business. The study, thelongest running of its kind, included more than 2 million Aetna members and comparedparticipants with traditional PPO plans versus those plans with high deductibles includingHealth Savings Accounts (HSA) and Health Reimbursement Arrangements (HRA).The study showed that members of consumer-directed plans accessed more preventive careand screenings than people with traditional PPO plans. In addition, members were moreengaged as a consumer of health care, did not forgo care but instead continued to get the carethat they needed. When compared to PPO members CDHP members were twice as likely togo online for: cost of care information, health information and benefits information.The study showed employers with complete replacement models saved more than thoseoffering the plan as an option. Also noted, members spent 12 percent more on preventivecare, diabetics in CDHPs accessed screenings at higher rate than diabetic members in PPO ph: (708) 845-3126 •
  6. 6. plans. Members also visited the emergency room for non-urgent care less than membersin PPO plans and they used prescription drugs to treat chronic conditions as necessary.The results also showed that HSAs continue to demonstrate more dramatic savings thanHRAs. Several other key findings showed employers offering plans that required increasedmember responsibility exhibited the best total cost trends. Specifically plans with a deductibleof at least $1,500 for individuals experienced approximately 4 percent lower total cost trendthan plans with deductibles that were less than $1,000. A new finding this year showed thatplans with coinsurance experienced trends as much as 5% higher than those with lowercoinsurance.Maximum savings came from well-designed plans offering incentives for CDHP participation,plan education and worksite wellness engagement. For details on the study, click here.Human Resource CenterSpousal Waivers and Exclusions on the RiseAs employers are faced with greater challenges to control benefit costs, they are rewriting theirbenefit philosophies, adopting consumer centric plan designs, developing higher cost sharemodels and reviewing who their plans cover. At open enrollment time, employees are "doingthe math" to determine which plan options best fit their familys needs. Dual income familiestake that a step further and determine which employer offers the best deal.Harsh as it might seem, employers are being forced to reconsider eligibility guidelines andcontribution sharing which might currently make their plan "the plan of choice" and attract notonly employee participants, but their dependents, even if other coverage is available to them.As a result, there is a strong trend to implement "spousal carve-out" or "spousal exclusionpolicies." They usually follow one of three formats: Working spouse pay a premium surcharge if working elswhere and has coverage available there. A requirement that the spouse purchase health coverage through his employers plan before also purchasing it through the other plan - making it secondary. An outright exclusion from coverage under the employers plan if similar coverage is available from the spouses employer. ph: (708) 845-3126 •
  7. 7. A recent Towers Watson survey report of 600 employers found that in 2010 nearly 20% usedspousal surcharges or waivers when other coverage was available for a spouse and another15% intended to add the provision by the end of 2012. For a deeper read offered by HRMagazine including legal questions and employee reactions click here.What is your Health Insurance IQ?According to a national survey conducted in September and October of 2011 by KeltonResearch and sponsored by eHealthInsurance fewer than six in ten (55%) consumers canconfidently say what a "deductible" is and even fewer are able to define or explain the terms"premium" (41%), "HMO" (34%), "coinsurance" (25%) or "copay" (61%).The confusion goes deep into their personal coverage not knowing if services arecovered. While 80%+ know doctor visits and prescription drugs are covered, about 60-70% donot know if their plans cover diagnostic services, overnight hospital stays, immunizations ormaternity care.The survey also notes the majority of Americans are confused or consider themselvesuninformed about Health Care Reform Legislation passed in 2010 (Patient Protection andAffordable Care Act). In fact, many feel the guaranteed issue and removal of pre-existingclause provisions are already in effect, when in fact it wont actually take place until 2014.Health Care Reform will not change Health IQs overnight. Members have to become moreengaged in the process as consumers, from cost to quality.Note" eHealthInsurance announced the release of its new book, Individual Health InsuranceFor Dummies, Health Care Reform Special Edition produced in cooperation with For Dummies,a branded imprint of Wiley. Congratulations to them for their efforts.Hospital SelectionA Thomson Reuters Healthcare Survey shows how a members income, education and agecan be influenced by hospital ratings. If their hospital received a bad rating, nearly 75% wouldchange hospitals rather than stay put. If specialty care is needed, slightly more than half wouldseek out the best-rated facility rather than go to their community hospital. If a serious illness isinvolved, nearly 60% would rely on ratings rather than community location in seeking care. Tosee the full study, click here ph: (708) 845-3126 •
  8. 8. Wellness InitiativesNovember is Diabetes Awareness MonthIf you currently do not offer screening, coaching or any other tools to assist employees in need, has the resources for those recently diagnosed. This includes treatments,strategies and support as well as suggestions and guidelines for those who wish to prevent ordelay the onset of Type 2 Diabetes. For more information view the November HortonHealth Initiatives Newsletter, click here.Wellness & Safety ChecklistIf you want to give your safety and health program a check-up, take a few minutes to completethe attached survey. There are no right or wrong answers - the survey is designed to help youquickly identify areas where improvements can be made.Horton Webinars & Seminars (Reminders)Click here for the latest Webinar & Workshop schedule through January 2012. ph: (708) 845-3126 •