Employees Need More Information About Their Benefits

by Leila Morris – 9/10/14

This enrollment season, employees have a message for employers about their benefits: “Tell us more, please.” Only 33% of employees rated the benefit education they received in 2013 as excellent or very good — a drop from 37% in 2012 and a reversal to the upward trend since 2009. In addition, 27% rated their benefit education as fair or poor, according to a survey conducted by the Harris Poll on behalf of Unum.

  • Employees they say they understand the following types of coverage at least somewhat:
    74% life insurance.
    71% vision insurance.
    47% critical illness insurance.
    40% medical understand coverage.
  • Forty-eight percent of those with long-term or short term disability benefits say that no one has explained disability insurance to them. Sixty-six percent say that their employers should do a better job of explaining these benefits.

Seventy-nine of those who say that get excellent or very good education about their benefits also rate their employer as excellent or very good compared to only 30% of those received fair or poor education about their benefits. Eighty-three percent of employees who did get education on their disability benefits gave that education a positive rating.

“The Affordable Care Act is raising lots of questions and leading to changes that extend beyond health coverage. Employees are making decisions about their benefits that they have never had to make before. It’s vital for employers to provide the right tools and information for employees so they can understand their benefits options and choose the coverage that is right for them,” explains Bill Dalicandro, vice president of Unum’s Consumer Solutions Group. For more information, visit www.unum.com.

What Consumers Want in a Critical Illness Product

Patients are getting medical diagnoses at earlier stages than ever due to medical advances, better treatment, and the fact that more people understand the importance of preventive care and early detection. However, critical illness contracts don’t typically pay a benefit for earlier diagnoses, so those claims are not triggering a benefit and policyholders are not getting paid when they think they should, according to a study by Trustmark.
Carriers have added conditions to the list of what they cover, but it’s not as helpful as it sounds. Less than 12% of people are ever paid a benefit for these conditions while the added coverage increases the cost of their policy. Consumers say they want the following in a critical illness policy:
• A benefit for an early-stage diagnosis.
• Access to a medical expert or doctor for advice.
• A policy that lasts throughout their lifetime with multiple benefits, regardless of whether they get sick. They don’t want something that only centers on them being ill.
• Less confusion on what qualifies for a benefit and whether enough time has passed to pay a benefit
• A benefit even if they were previously diagnosed for a condition
• A commitment that their premiums will not change over the life of the policy.

For more information, visit www.trustmarksolutions.com.

The Haves and the Have Nots of Dental Care

A survey by Oral Health America (OHA) reveals that there are two Americas when it comes to oral healthcare. Those with a household income of under $50,000 are more likely to skip dental visits, with 74% delaying care for financial reasons or lack of insurance coverage. Low-income Americans, young adults, students, and those with less education are less likely to floss (43% compared to 56% overall), less likely to eat healthy foods (56% compared to 62% overall), and more likely to smoke. OHA and the Dental Trade Alliance are bringing together oral health leaders on Capitol Hill today to address issues that affect lower-income communities. OHA board members and supporters will meet with members of Congress to encourage them to support policies that improve oral health. For more information, visit https://www.authoritydental.org/oralhealthamericaoralhealthamerica.org


Heffernan Insurance Brokers Honored for Corporate Wellness

Bay Area Heffernan Insurance Brokers is number two on the list of  the 2014 Healthiest Employers in the Bay area, according to the San Francisco Business Times and the Silicon Valley Business Journal. Hefferan is one of the largest full-service, independent insurance brokerage firms in the United States. For more information, visit www.heffins.com.

Some Could Lose Exchange Coverage If They Can’t Prove Immigration Status

Covered California is contacting about 98,000 families who need to resolve eligibility inconsistencies in their 2014 enrollment documents. Some consumers provided the required documents, but the agency could not reconcile the information to verify citizenship or immigration status. For example, some documents were illegible. In some cases, two pieces of proof were needed, but only one document was sent. The agency is asking consumers to submit documents showing that they are U.S. citizens, U.S. nationals, or individuals with eligible immigration status. Peter V. Lee, Executive Director for California’s health benefit exchange said, “If we do not get your documents, Covered California must cancel your health insurance, along with any federal tax credit you may be receiving that lowers your monthly premiums. If you have received tax credits, and your health insurance is canceled, you may have to repay those tax credits. If your health insurance is canceled, you may also have to pay a tax penalty.” Covered California is mailing emailing notices to consumers beginning this week. Consumers who don’t provide proof by September 30 risk losing their health coverage.

Thousands of partners, including Covered California certified insurance agents, certified enrollment counselors, service center representatives and county eligibility workers, will be available to help consumers submit the necessary documentation. Lee stressed that consumers should act quickly to submit the requested documents. For more information, call www.CoveredCA.com.

Doctor Shortages in LA Among the Worst in the U.S.

Los Angeles has the third most severe doctor shortage of any city in the nation, according to BetterDoctor.com. Los Angeles has 3,062 residents per doctor while San Francisco has only 1,466. Two California cities are in the nation’s top 25 with the highest ratio of doctors to patients: Sacramento has 1,090 residents per doctor and San Diego has 1,289.


AIG and Coventry Sue Each Other

AIG’s Lavastone Capital filed suit in New York federal court saying it had paid Coventry First more than $1 billion since 2006 to help it acquire life settlements. Lavastone says that Coventry used a network of shell companies to inflate prices, costing Lavastone more than $150 million. In a countersuit, Coventry accused Lavastone of breaching an exclusive contract by allowing an affiliate to purchase life settlements from other businesses. Conventry says that Lavastone made up the fraud allegations to escape a contract that limits its ability to resell certain policies, which Coventry estimated could cost AIG $700 million. Coventry is asking for an award of more than $100 million and declaration that Lavastone is not entitled to damages. Lavastone spent about $6.5 billion over a decade to acquire nearly 7,000 life settlements with a face value of $20 billion, but has wound down its life settlement business.

Coventry issued the following statement: We are disappointed by AIG’s breaches of our agreements, and by our need to resort to litigation to remedy those breaches.We are astounded that AIG would bring a lawsuit that as AIG knows, rests on a fiction. AIG claims to have been unaware of practices that were documented and acknowledged through a process that AIG requested. Further, every year, AIG’s independent internal audit group audited its transactions with Coventry First, fully aware of and focused on the very practices it now claims were fraudulent, and found no violation of the agreements between the parties.  AIG’s lawsuit also is an attempt to negotiate by litigation. In an effort to rewrite long-standing agreements that it now finds onerous, AIG has concocted allegations to escape contractual provisions that limit its ability to resell policies in the tertiary market. AIG’s complaint is a cynical attempt to distract its shareholders from its own breaches and its failure to disclose the contract restrictions it seeks to escape. These limitations have an estimated value to the portfolio, and to Coventry First, of $700 million. Going forward, Coventry will aggressively prosecute its lawsuit against AIG, defend itself against AIG’s retaliatory lawsuit, and require AIG to adhere to all contract provisions in the existing business agreements.


Comprehensive Cost Transparency Tool to Be Online Soon

Early 2015 is the kickoff time for free and comprehensive healthcare transparency tools, according to the Health Care Cost Institute (HCCI). The tools, which offer information on price and quality of health care, will be available to consumers, purchasers, regulators, and payers in an easy format. Employers will be able to customize their employees’ experience. Future updates will include the ability to compare provider prices.

The tools will link aggregated data from commercial health plans to data from Medicare Advantage and Medicaid health plans. Price data includes the allowed amount paid by the insurer plus copays and deductibles. Assurant Health will join Aetna, Humana and UnitedHealthcare to work with HCCI on the tools. Other carriers are expected to sign on.

Health Net, Kaiser Permanente, and Partners HealthCare are helping develop consumer transparency and public reporting standards for capitated, integrated, and valued-based health plan designs. “These recommendations will offer valuable insights about health costs and resources and make information on the cost and quality of health care more accessible and easier to understand, particularly in light of new payment models,” said David Newman, Executive Director of HCCI.

GAO Finds Flaws in CMS Audit Program

The Centers for Medicare & Medicaid Services (CMS) does not provide enough oversight to the contractors that audit Medicare reimbursement claims, according to an investigation by the Government Accountability Office (GAO). GAO finds that inappropriate and multiple audits are crippling the operations of many home medical equipment providers. Last December, administrative law judges suspended action on new audit appeals because of a backlog of more than 600,000 cases. Closing down the appeals process has forced many to shut their businesses or stop seeing Medicare patients because they don’t get paid during the appeals process. “The information in this report can now be used by Congress and CMS to…ensure more consistent oversight of  the contractors and audit process,” said Rep. Diana Louise DeGette (D-CO). For more information, visit www.aahomecare.org .

Experts Predict A Big Boost in Access to Mental Health Drugs

Doctors and managed care organizations anticipate increased demand for drugs that treat major depression, bipolar disorder, and schizophrenia, according to a survey by Decision Resources Group. The demand for these drugs will rise thanks to Medicaid expansion in 24 states and affordable coverage through the exchanges. Doctors expect to see 30% more patients with these conditions. Managed care organizations say that drug formularies in the exchanges are the same or compare favorably to those of traditional group health plans. While there are many generic drugs to treat these behavioral health conditions, managed-care organizations offer favorable tier placement to brands they believe offer superior efficacy, safety, and tolerability.

Branded behavioral drugs, such as Brintellix, Saphris, and Fanapt are excluded less often from exchange plans than from commercial group plans. Abilify will launch generically in 2015, which is expected to increase utilization, especially in Medicaid plans and in managed-care plans that offer higher payments for physicians with high generic prescribing rates.

Narrow provider networks in the exchanges are expected to drive many patients to visit primary care doctors for  behavioral conditions. Compared to psychiatrists, these generalists are not as familiar with the newer branded drugs, and they welcome information about pharmaceutical companies’ patient assist programs. Doctors overwhelmingly support patient assistant programs. They say that patients will still need drug coupons when they face high deductibles or formulary exclusions through an exchange plan. For more information visit www.DecisionResourcesGroup.com.

Workers Spend Less Than 15 Minutes Choosing Health Benefits

Forty-one percent of employees spent 15 minutes or less analyzing their health benefit options during the 2013 open enrollment season; and 24% spent five minutes or less, according to a recent Aflac open enrollment survey. Forty-two percent waste up to $750 a year on mistakes with their insurance benefits. The survey also found the following about workers:
• 90% auto-enroll or keep the same benefits year after year.
• 73% sometimes, rarely, or never understand everything their policy covers.
• 64% sometimes, rarely, or never understand changes in their coverage.
• 64% disagree or only somewhat agree that they are more prepared for open enrollment this year compared to last year.
For more information, visit AflacWorkForcesReport.com or follow @aflac on Twitter.


Enrollment Support Tools

Transamerica Employee Benefits is offering interactive enrollment education and decision support tools at no cost to eligible employer groups. This limited time offer will be available September 1 to January 1, 2015. The platform will include educational modules for voluntary products underwritten by Transamerica Life Insurance Company – critical illness and accident insurance – along with medical, term life, hospital indemnity, dental, and vision insurance modules. It makes it easy for producers and employers to provide a personalized enrollment experience. For more information, visit www.transamericaemployeebenefits.com.

Social Media Content For Financial Reps

Guardian Life is expanding its social media program to financial representatives and wholesalers. They now have access to articles, images, and videos that they can post to their followers and prospective clients. On average, Guardian’s users share eight pieces of content each month. The program was recently recognized at the LIMRA LOMA 2014 Social Media Conference for Financial Services with the Best Use of LinkedIn Award. For more information visit www.GuardianLife.com.

New Investment Options

There are 21 new investment options with the Guardian Choice and The Guardian Advantage investment lineups. The enhancements increase the flexibility and breadth of asset classes.  The additions include offerings from new fund families, such as American Funds, Morgan Stanley Investment Management, Natixis Funds, OppenheimerFunds, and Putnam Investments. There are also offerings from existing fund families including Vanguard, MFS, Franklin Templeton Investments and Invesco. With these news funds, The Guardian Choice now totals 138 funds while The Guardian Advantage has 111. For more information, visit 401k.GuardianLife.com.


Fidelity & Guaranty Life launched an annuity product, Income and WealthBuilder. It’s for retirement savers who want accumulation and income benefits. The product offers a seven-year and 10-year surrender schedule option for maximum flexibility. It features five interest-crediting options. Income and WealthBuilder offers an optional guaranteed minimum withdrawal benefit rider (GMWB) that allows the owner to receive the larger of premiums paid in the first contract year accumulating based on a 7.2% compounding roll-up rate or the initial premium plus an 18% income base bonus credited to the client’s income benefit value. These features are designed to meet the needs of annuity policyholders who are seeking accumulation and income in the near future.

Voya Debuts Brand Campaign

Voya Financial, formerly known as ING, launched a consumer marketing campaign that runs through the rest of 2014. The campaign includes television, digital, mobile, search, social media and trade advertising. Voya’s rebranding began in April when its holding company and philanthropic foundation transitioned to the new brand. The company’s five business segments now operate as Voya. The company also introduced its new website, http://voya.com.  A new television commercial will run September through November on a wide range of network and cable media properties during professional sports, news, and late night programming. The spot can be viewed at http://go.voya.com/ButterflyAd.

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