NEW PRODUCTS
Universal Life Products
Protective Life Insurance Company and West Coast Life Insurance Company released the Income Provider Option for their universal life insurance products. The Income Provider Option is an optional, no cost endorsement that provides a guaranteed income stream death benefit to designated beneficiaries. Policy owners can choose the amount, duration, and frequency of the guaranteed income payments. There is also an option to include an initial lump sum to help meet immediate needs, such as a mortgage, medical bills, tuition, and final expenses. Income stream payments can be made for one to 30 years, monthly, annually or on a annually-recurring day, such as a birthday, holiday or anniversary. For more information, call 205-268-3029 or e-mail eric.miller@protective.com.
E-mail Signature Quote Engine
Disability Insurance Services (DIS) is introducing a no-cost disability insurance quote engine and e-mail signatures that agents can add to their websites. The quote engine processes leads through a link in the e-mail signature. The client clicks on the link and is automatically put into an online application. Once the application is complete, the broker gets several disability insurance quote options within 24 hours. For more information, visit http://www.diservices.com or call 800-898-9641.
Retirement Plan Designation from UCLA
UCLA Anderson School of Management is offering The Retirement Advisor University. It is the first retirement plan management certification program offered in cooperation with a nationally recognized institution of higher learning. For more information, visit http://www.anderson.ucla.edu/x24218.xml.
Fiduciary Training Tools
Securian is offering its Retirement’s Fiduciary Clarity program to help advisors educate employers about their investment and administrative fiduciary responsibilities. Tools include the following:
• Worksheets
• Checklists
• Online tools
• Investment due diligence resources
• Reports
• Templates
• Participant communications
For more information, call 651-665-7558
Fee Disclosure Website
The Principal Financial Group launched a website dedicated to educating financial professionals and plan sponsors about the fee disclosure regulation unveiled recently by the Department of Labor. For more information, visit www.principal.com/feedisclosure.
Disability Training Kit
Assurant Employee Benefits introduced the Total Income Protection Kit to help brokers and employers understand how employees’ income can be protected and ensure that there are no gaps or overpayments in their disability plans. It includes an informational guide of frequently asked questions, templates for self-funded salary continuation plans, and a glossary of terms. Brokers can request a toolkit from their Assurant Employee Benefits sales representatives or they can e-mail benefits@assurant.com.
Integrated Healthcare and Disability
Anthem Life Insurance Company introduced Productivity Solutions, which integrates healthcare and short-term disability programs for employer groups with 51 or more employees. Productivity Solutions is a way of managing short-term disability claims for customers with Anthem health benefit plans. The program provides an integrated approach to health, disability and absence management. Anthem says that the program results in lower disability claim costs and a faster claim turn-around time. For more information, visit www.anthem.com/specialty/co and select the Integrated Health, Absence & Disability Management Report link.
Tool To Match Client Needs to Products
American General introduced an online tool called “I’ve
Got a Client?” It is designed to help advisors match client needs with life, annuity, and accident and health product. For more information, visit www.GotaClient.com.
Disability Insurance Claim Denied and or, How to Minimize a Denial
Disability Insurance Resource Center published its second DI manual, “The
anatomy of Denied Disability Insurance Claims.” It describes “carrier’s tricks when denying a claim.” For more information, call Larry Schneider, principal of Disability Insurance Resource Center at 800-551-6211, e-mail: info@di-resource-center.com, or http://www.di-resource-center.com.
Webinar On How Insurance Exchanges Will Affect the Industry
Atlantic Information Services Inc. is holding an August 31 Webinar titled, “Insurance Exchanges: How to Prepare for Their Affect on Small-Group and Individual Markets.” Four industry insiders will conduct a 60-minute roundtable discussion and 30 minutes of Q&A, For more information on registration and fees to attend visit, http://www.aishealth.com/Products/C0M33_083110EBINC.html.
IN CALIFORNIA
New Regulations Crack Down on Illegal Rescissions
Insurance Commissioner Steve Poizner announced new regulations designed to combat illegal rescissions. The new regulations will go into effect on August 18.
Poizner said, “Health insurers may only rescind policies under very limited circumstances defined by law and regulations. In the past, some insurers have exploited vagueness in these laws to improperly rescind health insurance policies. These regulations clarify the law to protect consumers from these illicit practices and set out steps insurers must take before they can legally rescind. All insurers must file revised health history questionnaires that comply with the new regulations and get Department approval.”
The regulations do the following:
• Prohibit insurers from rescinding policies when they are not in compliance with specified underwriting practices regulations.
• Restrict health condition and history questions on applications to those that are necessary for medical underwriting.
• Require all questions on health insurance applications be clear and understandable.
• Require use of new and improved health history questionnaires approved by the Department before an insurer can rescind.
• Allow consumers to indicate that they are unsure of or cannot remember the answer to a particular health history question.
• Require that agents attest if they help applicants with a health insurance application.
• Prohibit confusing phrasing of application questions like double negatives and certain compound questions.
• Require that consumers be given a copy of their application to check for discrepancies.
• Require that insurers not rely solely on self-reported health history when possible.
• Prohibit insurers from conducting certain rescission-focused investigations long after becoming aware of a possible misrepresentation or omission by the applicant. Also prohibit insurers from seeking information outside the scope of such an investigation.
• Require that insurers give consumers the opportunity to respond during rescission investigations, and that insurers must listen to consumer-provided information.
• Require that insurers identify and resolve any reasonable questions arising from the application. Insurers must document their effort to resolve these issues and make those documents available to the Commissioner.
For more information, visit www.insurance.ca.gov.
HEALTHCARE
Most Employers Expect to Lose Grandfather Status With Their Health Plans
Ninety percent of U.S. companies anticipate losing grandfathered status by 2014, with the majority expecting to do so in the next two years, according to a survey by Hewitt. The study covered 466 companies representing 6.9 million employees. Under the grandfather provision of the U.S. Patient Protection and Affordable Care Act, Companies can lose their grandfather status if they take certain steps such as reducing benefits, significantly raising co-payment charges, significantly raising deductibles or changing insurance carriers.
Most companies expect to lose grandfather status because of health plan design changes (72%) and/or changes to company subsidy levels (39%). Employers also cited consolidation of health plans (16%), changes to insurance carriers (16%) and union negotiations (15%) as additional reasons. Seventy-seven percent said that recently released guidance on preventive care did not affect their decision to maintain grandfathered status.
Fifty-one percent of companies with self-insured plans expect to first lose grandfather status in 2011 and another 21% plan to lose status in 2012. This timing is similar for companies with fully insured medical plans, with the vast majority expecting to lose status in 2011 (46%) or 2012 (18%). For more information, visit www.hewitt.com.
Federal judge Says Virginia’s Health Reform lawsuit Can Move Forward
A federal judge ruled that Virginia has standing to bring its lawsuit seeking to invalidate the federal Patient Protection and Affordable Care Act. Federal district court judge Henry E. Hudson denied the federal government’s motion to dismiss the commonwealth’s suit. Virginia alleges that the federal law invalidates a Virginia law, the Health Care Freedom Act.
Attorney General Ken Cuccinelli said, “This lawsuit is not about healthcare; it’s about our freedom and about standing up and calling on the federal government to follow the ultimate law of the land – the Constitution. The government cannot draft an unwilling citizen into commerce just so it can regulate him under the Commerce Clause.” The Dept. of Justice argued that Virginia lacked the standing to bring a suit, that the suit was premature, and that the federal government had the power under the U.S. Constitution to mandate that citizens must be covered by government-approved health insurance or pay a monetary penalty.
The Court recognized that the federal health care law and its associated penalty were literally unprecedented. Specifically, the Court wrote that “[n]o reported case from any federal appellate court has extended the Commerce Clause or Tax Clause to include the regulation of a person’s decision not to purchase a product, notwithstanding its effect on interstate commerce.”
A summary judgment hearing is scheduled for October 18, 2010, at 9:00 a.m. to decide if the federal health care law is unconstitutional.
Medical Errors Cost at Least $19.5 Billion Annually
Measurable medical errors cost the U.S. economy $19.5 billion in 2008, according to a study by the Society of Actuaries (SOA) and completed by consultants with Milliman Inc. The report used claims data to provide an actuarially sound measurement of costs for avoidable medical injuries. Of the approximately $80 billion in costs associated with medical injuries, around 25% were the result of avoidable medical errors.
Jim Toole, FSA, CERA, MAAA and managing director of MBA Actuaries Inc.
A recent SOA survey, reveals that 87% of actuaries believe that reducing medical errors is an effective way to control healthcare cost trends for the commercial population and 88% believe this to be true for the Medicare population.
The following are key findings of the study:
• There were 6.3 million measurable medical injuries in the U.S. in 2008; of the 6.3 million injuries, the SOA and Milliman estimate that 1.5 million were associated with a medical error.
• The average total cost per error was approximately $13,000.
• In an inpatient setting, 7% of admissions are estimated to result in some type of medical injury.
• The measurable medical errors resulted in more than 2,500 avoidable deaths and more than 10 million excess days missed from work due to short-term disability.
• Approximately 55% of the total error costs were the result of five common errors:
pressure ulcers, postoperative infections. mechanical complications of devices, implants, or grafts, postlaminectomy syndrome, and hemorrhages complicating a procedure.
For more information, visit: http://www.soa.org/research/health/research-econ-measurement.aspx.
Majority of Likely Voters Favor Repeal of Reform Law
Voter pessimism towards the new national healthcare bill has reached an all-time high, according to a new Rasmussen Reports national telephone survey. The number of insured voters who feel it will force them to switch their coverage is up 11 points from early last month. Rasmussen Reports conducted the survey of 1,000 Likely Voters on July 30 to 31.
Fifty-seven percent of Likely U.S. Voters say the recently passed healthcare law will be bad for the country. That’s the highest level of pessimism measured since regular tracking began following Congress' passage of the law in late March. Thirty-two percent say the healthcare plan will be good for the United States.
Prior to this survey, belief that the plan is good for the country ranged from 34% to 41%, while those who predict it will be bad for the country range from 49% to 54%.
While 70% of mainstream voters feel the bill is bad for the country, 80% of the political class disagree and see it as a good thing for america.
Fifty-nine percent of all voters now favor repeal of the healthcare bill. Most Republicans and unaffiliated voters continue to strongly favor repeal of the healthcare bill and believe it will be bad for the country. Democrats have remained supportive of the bill and feel it will be positive for the country.
Seventy-seven percent of those with health insurance rate their coverage as good or excellent while only seven percent 7% say it's poor. These figures show little change since early June.
However, 51% of those insured voters say it’s at least somewhat likely that passage of the healthcare bill will mean they have to change their insurance. That’s up from 40% in early July and is the highest level measured in two months. Twenty-nine percent say it's very likely and 38% say it’s not likely. For more information, visit http://www.rasmussenreports.com.
EMPLOYEE BENEFITS
Voluntary Industry Confidence Index Continues to Increase, According to Eastbridge’s Mid-Year 2010 Survey
Confidence in the future of the voluntary industry continues its move up to historic levels. “We are quite excited to see the index continue to go back up as those in the industry grow more confident of voluntary’s role. The index is at its highest level in three years, says We believe this is a result of our slowly improving economy and the opportunities that those in the industry see with healthcare reform and employer efforts to control benefit costs while still providing employees a way to cover their families,” said Gil Lowerre, president of Eastbridge.
The Confidence Index increased to 99.9, up from 95.9 at year end 2009 and 92.9 in the mid-year 2009 survey. The index is calculated based on three key measures: sales growth, profitability of the industry, and employee enthusiasm about voluntary products.
Bonnie Brazzell, vice president, Eastbridge said “All three of the key measures for the index were up this time. We saw significant increases in the questions about industry profitability and employee enthusiasm for voluntary.” Eighty-two of respondents expect employee enthusiasm to increase, up from 71% as of the year-end 2009 survey. Eighty-six of respondents in the most recent survey (conducted in July) believe that sales will increase over the next 12 months.
The Voluntary Industry Confidence Index study is conducted semi-annually and includes responses from carriers, brokers, and vendors. For more information, visit www.eastbridge.com.
