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Sunday April 20th 2014



Affordable Health Coverage Key to Attracting Uninsured Young Invincibles


• Affordable Health Coverage Key to Attracting Uninsured Young Invincibles
• Insurers in Calif. Health Exchange Limit Providers
• A Great Argument For Disability Benefits
• Stop Loss Cancer Rider
• Partnership Program for 401(k) Consultants
• Dental Plans that Meet ACA Requirements
• Health Exchange Subsidy Tool
• Lifetime GUL
• Legislative Alert
• The Role of Brokers in the Exchange
• Commissioner Warns Against ACA-Related Fraud
• Long-Term Care Firm Seeks Alliances 1,000 Advisers
• Webinar Demonstrates Online Enrollment Tomorrow
• Defined Contribution Forum
• Oral Care Reduces Medical Claims


Affordable Health Coverage Key to Attracting Uninsured Young Invincibles

invincibleOnly 20% of uninsured adults (aged 18 to 64) who don’t have employer coverage say they are healthy enough to go without health insurance, according to a study funded by the Robert Wood Johnson Foundation. These findings suggest that well-targeted outreach and enrollment efforts may succeed.  The key will be whether new coverage options will be perceived as affordable and worth the cost, according to the study. The study also reveals the following:

37% Tof uninsured people say that health insurance is not worth the money.

33% of uninsured non-elderly adults say they are risk-takers. Uninsured people who are risk-averse are more than twice as likely to say they don’t need health insurance (33%) or that it is not worth the cost (51%).
35% of uninsured adults 18 to 29 are risk-takers compared to 28% of uninsured adults aged 40 to 64. Thirty-six percent of young adult risk-takers say they don’t need insurance compared to 26.6% of older adult risk-takers.

82% of young adults who describe themselves as risk-averse agree that health insurance is important.

While more than 90% of young adults say their health is excellent or good, 73% agree that health insurance is important.

14% of African Americans say they don’t need health insurance compared to 21% of Caucasians. Also, wenty-six percent of African Americans say health insurance is not worth the cost compared to 42% of Caucasians. For more information, visit

Insurers in Calif. Health Exchange Limit Providers

Insurers selling health coverage through California’s insurance exchange have limited the number of doctors and hospitals available to policyholders in an effort to lower premiums, reports the Los Angeles Times.
For example, Health Net will offer the lowest cost coverage options in Southern California, but policyholders will have access to less than one-third of the insurer’s network of providers for employer-based plans. In addition, Blue Shield of California’s exchange plans will include only 50% of the insurer’s usual provider network. Some exchange plans will exclude certain large hospitals. Anthem Blue Cross officials said they are offering the only exchange plans that include UCLA Medical Center and other University of California health facilities.

A Great Argument for Disability Benefits

Most disability-insurance beneficiaries say their benefits played a critical role in preserving an adequate standard of living, according to a survey by the Consumer Federation of America (CFA) in partnership with Unum. Twenty-three missed a mortgage or rent payment, but an additional 49% said they would have missed a payment if they hadn’t received disability benefits. Fourteen percent 14% had to move out of their home because they could no longer afford to live there, but an additional 44% said they would have had to move if they hadn’t received disability benefits.

Forty-two percent missed at least one bill or consumer loan payment, but an additional 41% said they would have missed a payment if they didn’t have disability coverage. Thirty-one percent applied for community or government assistance to help pay for food, but without disability benefit an additional 33% said they would have applied if they hadn’t had disability benefits.

Beneficiaries did report a reduced standard of living since disability benefits typically replace only 60% of pre-disability income. Eighty-five percent had to cut back or stop saving for retirement; 58% skipped or delayed some medical, dental, or vision care for themselves or family members; and 57% cut back on spending to the point of having an uncomfortable lifestyle.

The following are some typical comments from beneficiaries about their disability benefits:
• “I would have been forced to declare bankruptcy. I would have probably lost my house and my cars.”
• “I would have lost my home. I would have been homeless and living in a shelter with my daughters. I wouldn’t have been able to afford food or gas for the car to get them to school.”
• “I have a neuro-muscular disease and I would not have been able to afford to pay for the medicine and support myself at the time. I would not have been able to survive.”

Beneficiaries said disability benefits helped them do the following:
• 77% avoid strain with spouse or partner.
• 78% maintain their self-esteem as a provider for their family.
• 88% maintain a healthy emotional outlook.

Sixty-eight percent said their health would have been worse without benefits.
Here are some typical comments from beneficiaries about how they would have felt if they did not have disability benefits:
• “I probably would have gone off the deep end.  It would have been too much to bear with the health problems I have.”
• “I would have felt awful, scared, stressed.”
• “Without the benefit payments there would have been home pressures.  I would have felt dependent, where I don’t have control of my life, trapped, child-like.”

Ninety-five percent would encourage other people to get disability insurance through their employers, and 58% said their disability benefit made them feel more favorable about their employer. Eighty-five percent said employers should automatically enroll new employees in disability insurance, allowing them to opt out of this coverage.

Eighty-eight percent of beneficiaries said that employers should do a better job of explaining disability insurance and 85% said the government should inform the public about the risk of becoming disabled and its financial impact. Workers had he following comments:
“I’m glad they made me take it. Because it wasn’t a volunteer thing, and I didn’t think that way.”
“Any employer that offers disability insurance shows that they care.  To me that’s very important because your life can change.”
“Employers should sit down and explain to the employees about their long term and short term disability coverage, because they don’t know what’s going to happen, and everyone should. I’ve made sure to tell everyone about everything, to get the insurance. Because without it, I don’t know what I would have done.” For more information, visit


Stop Loss Cancer Rider

Sun Life is offering its Stop-Loss Cancer rider. Qualifying employers with a stop-loss deductible will get a reduction up to $10,000 (depending on the size of the deductible) when Sun Life reimburses an employer for a catastrophic cancer-related claim. Under Sun Life’s critical illness policies, upon diagnosis of a covered condition, covered employees get a lump sum payment from $5,000 to $50,000, depending on coverage levels. For more information, visit

Partnership Program for 401(k) Consultants

For every new plan that closes between September 16, 2013 and December 27, 20131, John Hancock RPS will pay the plan’s TPA according to the following scale:
A $400 payment for a 401(k) plan size of up to $250,000, an $800 payment for a plan size of $250,001 to $1 million, and $1,200 payment for a plan size of over $1 million.
For more information, visit

Dental Plans that Meet ACA Requirements

Guardian Life is offering dental benefits that meet affordable Care Act (ACA) requirements. Affordable plans include the required pediatric dental essential health benefits. Guardian will ensure that members get the greater benefit between the traditional coverage and the required pediatric benefit.
Employers who select medical coverage that includes the pediatric dental essential health benefit can keep their current plan or opt for Guardian’s comprehensive coverage that excludes pediatric preventative care. By excluding just preventive care, members under 19 will be covered for basic and major services under their Guardian plan without being subject to the medical plan’s deductibles and out-of-pocket maximums.
Jolynne Williamson, Assistant vice president, Group Dental Products, of Guardian said that businesses and consumers could risk losing many of the dental benefit they have come to rely on if they mistakenly say the oral health essential-health benefit is equivalent to a stand-alone dental plan, explained Williamson.  The following are some hidden pitfalls:
• The oral health essential-health benefit applies to members up to age 19, but not to adults, so children may be covered for dental but not their parents. This means that adults may need to purchase separate dental insurance that could require them to go to a different dentist.
• When the pediatric dental benefit is part of a medical plan, a member may end up paying more out-of-pocket costs for dental services than with a stand-alone dental plan, due to having to meet their medical deductible or medical out-of-pocket maximum before being able to access their full dental benefit.
• Since medical insurers are not experts in dental care, they are not likely to provide the same size networks, levels of coverage, and streamlined processes for claims handling that are common with dental insurers.
• Keeping dental separate benefits lessens the effect of the Cadillac Tax, which will be imposed on medical plans beginning in 2018 – stand-alone dental carriers are exempt from the tax.

For more information about Guardian, visit

Health Exchange Subsidy Tool

Experian Healthcare launched a tool that helps healthcare providers identify patients who meet the income requirements for health-insurance exchange tax credits and federal subsidies. It also helps automate the enrollment process by populating the state’s health-insurance exchange application form. For more information, visit

Lifetime GUL

American General is offering a highly flexible guaranteed universal life insurance policy called “Secure Lifetime GUL II.” It provides increased options for 1035 and shorter pay scenarios and includes an integrated enhanced surrender value rider (a return of premium feature). It is now available with the new Lifestyle Income Solution that can turn a life insurance product into a guaranteed stream of retirement income. For more information, visit


Legislative Alert

California Health Underwriters is urging members to contact Governor Brown to veto SB 353 (Lieu). This bill would impose significant new translation requirements on health plans and licensed agents in the individual and small group market. Plans would have to translate letters, notices, enrollment applications, grievance information, and summaries of benefit into languages that are spoken only by a minority of a plan’s membership simply because the plan attempted to reach these communities in their own language or if one of its agents held themselves out as doing business in any of the identified languages in the bill. For more information, visit

The Role of Brokers in the Exchange

CAHU’s V.P. of Communications, Meg McComb, recently interviewed Chris Patton, vice president of SHOP and Agent Management for Pinnacle. The following are some highlights of his comments:

• I don’t see cataclysmic scenarios happening in the small group market. Covered California will offer coverage through the SHOP and the individual marketplace. Agents will have the ability to offer products, and we could see more dependent coverage through the individual marketplace, depending on the employer contribution. Having the two Covered California products available to agents presents an exciting opportunity for agents and the potential insured.

• Agents who embrace the upcoming changes and tailor their marketing to meet the needs of the consumer are going to be wildly successful. The opportunity for agents is very similar to when AB 1672 got passed. It was the same reaction; everyone was freaked out. Some thought that they were going to have to change professions, but others thought, “Wow, this is an opportunity.” If an agent sees this as an opportunity to provide new product and information to business owners as a trusted advisor, I am confident that they will thrive in 2014 and beyond. Business owners are thirsty for information. There are agents and agencies out there that have embraced the upcoming changes and are communicating to their clients and prospective clients.

The ACA has prompted several new [private] exchange offerings. Competing private exchanges that offer good products at competitive prices will be a good thing for our market and will help to increase awareness for the model. Guaranteed issuance for individuals will have a significant impact in the market. It’s a huge change to policy. The real question is whether we will see small groups migrate away from purchasing group coverage and encourage their employees to individual coverage instead. Businesses that continue to provide group coverage in 2014 and beyond will enjoy employee retention, increased productivity, and reduced  absenteeism. The success of SHOP is going to depend on the agent distribution system. Working with the SHOP distribution model will be no different than working with a carrier or a TPA. We are agent driven. My team is here to support agent sales. We are looking to the certified insurance zgent for distribution direct and through our general agent partners.

• The SHOP will bring a new mix of carriers at a very competitive price point. In 2014 small business must be enrolled in the SHOP to benefit from available tax credits. Not every group will benefit this since there are limits to the number of employees and average income. But there will be significant advantages for employers that fall into the sweet spot. Covered California will have a tax credit calculator available later this Fall that will allow agents to get an idea of what a tax credit would look like for a small business.

• The SHOP’s networks will represent over 80% of the doctors and acute care hospitals in California. We will have a complete picture in the coming weeks, but I think we will end up with networks that allow SHOP to be a strong competitor.

• We have seen an incredible response from the agent community to the registration and certification process with Covered California. In the coming year there will be a lot of change. Agents will have a big job to do getting information to the consumer. Agents will have an opportunity to show that they are a necessary and valuable part of those changes in their role as trusted advisors.

• The technology that will power Covered California in the small group market is going to be a big change. Online enrollment will be the primary submission method. We will accept applications by paper, phone, and fax, but online is the fastest route for a group to get issued. This technology will be a big factor for agents and their clients. Small group employers and their employees aren’t used to using iPad’s and sitting around on their computers to fill out their applications. The online enrollment feature represents a technological advance for the small group market. It will be interesting to see the adoption rate. The small group underwriting process will change in 2014. CalHEERS represents exciting technology in the small group space that we have really only seen for large group. It will be interesting to watch the early adopters change the way small group has traditionally been presented and enrolled.

Commissioner Warns Against ACA-Related Fraud

Insurance Commissioner Dave Jones is warning consumers against bogus websites attempting to associate themselves with the new health exchange. Some of these online portals instruct consumers to enter personal information to learn about new health insurance products. Insurance Commissioner Jones warns consumers who want to shop through Covered California not to enter any personal or financial information into a website without first verifying they are in fact on the official Covered California website. The department has succeeded in getting some websites taken down and others to change their misleading content. Additionally, the department’s licensing bureau has denied more than 150 license applications for business names designed to market health coverage services because the proposed names could confuse or mislead the public into believing they were actually California’s health benefit exchange – Covered California.


Long-Term Care Firm Seeks 1,000 Advisers

LTC Financial Partners, LLC is offering alliance opportunities to 1,000 independent advisers. Advisers may choose one of three options:

  1. Expand their business by referring clients who need LTCFP’s solution set.
  2. Join LTCFP’s network as an Associate, with a path to becoming an equity Partner. (This option is for experienced LTC advisers.)
  3. Enter the LTC Institute, run by LTCFP, to learn the business from scratch.

In all three options, the chosen advisers may remain independent. For more information, visit


Webinar Demonstrates Online Enrollment Tomorrow

Covered California is hosting a Webinar to demonstrate the online enrollment application process that will be available to consumers starting Oct. 1. The demonstration will include a prerecorded session showing a person completing each page of the application for health insurance and Medi-Cal enrollment. After the demonstration, Covered California representatives will answer questions. It will be held Thursday, Sept. 26, 2013 from 10:00 11:30 a.m. Here is the Webinar link:

Defined Contribution Forum

Defined Contribution: The Next Frontier of Health Care Consumerism will be heldDecember 5 at Red Rock Resort & Spa in Las Vegas. It is sponsored by the The Institute for HealthCare Consumerism. For more information, visit


Oral Care Reduces Medical Claims

People with certain chronic conditions who got appropriate dental care saved an average of $1,038 on yearly medical and dental claims costs, according to a survey by United Healthcare. Among diabetics, the average annual net medical and dental claims were $1,279 lower per person for people who received treatment for gum disease compared to people who did not. The savings for all of those groups were achieved even after accounting for the additional cost of the dental care.

“This study demonstrates that employers can benefit from analyzing their medical and dental benefits collectively. By taking this approach, companies can take steps to engage employees around their dental health and improve health outcomes, potentially reducing health care costs and driving productivity with a healthier workforce,” said Michael Weitzner, DMD, MS, vice president, UnitedHealthcare Dental.