First Tennessee Bank is getting into the health insurance business.
First Tennessee Insurance Services Inc., has added an employee benefits team to provide health benefits for small businesses in Memphis and Mississippi. Jeff Goldsmith, previously of PacifiCare Health Systems, and Danny Brown, from Current White Associates, have been recruited as agents. Donna Cody was recruited from UNUM Provident as an account manager.
First Tennessee is now selling group plans underwritten by Blue Cross Blue Shield of Tennessee, Inc., United Health Group and Principal Financial Group. Other companies are in negotiations.
First Tennessee Insurance Services is part of Memphis-based bank holding company First Horizon National Corp. (NYSE: FHN).
Friday, March 31, 2006
No-fault auto insurance law closer to renewal
By Stephanie Horvath
Palm Beach Post Staff Writer
Friday, March 31, 2006
It appears Florida's system of paying for medical care after a car crash will stay in place for at least another year.
On Thursday, the House Insurance Committee passed a bill that would reenact Florida's no-fault system, which was scheduled to sunset next year.
The Senate Banking and Insurance Committee also passed a bill renewing no-fault on Tuesday.
Both make some reforms to the system, though not as many as the insurance industry wants.
At issue is the required personal injury protection, or PIP, part of auto insurance policies. It provides $10,000 in medical care, disability and death benefits for a person after an auto accident, regardless of who is at fault.
In states without no-fault laws, health insurers pay for medical care after an accident, and people must sue to recover other costs like lost pay.
Rampant fraud and abuse led lawmakers to enact reforms in 2001 and 2003, and finally to vote to repeal the no-fault law on Oct. 1, 2007, unless it was renewed this year.
The no-fault law has been hotly contested, partly because the insurance industry is split over it. Some large insurers, like State Farm, Allstate and Nationwide, want to see the law repealed.
Others, like Progressive and Geico, want to see it renewed with significant changes, like medical fee schedules for doctors and limits on attorney fees. Those reforms have met strong resistance from doctors who care for car crash victims and lawyers who sue insurance companies.
All groups have been aggressively lobbying lawmakers. Rep. Dennis Ross, R-Lakeland, chairman of the House Insurance Committee, said his chamber's bill strikes a balance.
"I think we've been very, very sensitive to the health care providers out there," he said. "This doesn't affect what you charge. It does not prohibit attorneys' fees. This is a compromise... necessary in order to continue to move these issues forward."
The House bill would require PIP to pay an additional $10,000 just for emergency room care, leaving victims with another $10,000 for other care. It would also forbid attorneys from multiplying their fees except in certain situations and require motorcyclists between the ages of 16 and 20 to have insurance, including PIP. The bill would also make it a felony to create fake accidents on paper.
The Senate bill passed Tuesday included about $3.3 million in state money to give pay raises to state fraud investigators, hire as many as 19 new investigators and hire six new insurance fraud prosecutors.
The state Division of Insurance Fraud has said it regularly loses investigators to the Florida Department of Law Enforcement, which pays better.
In spite of PIP fraud, auto insurance rates are competitive.
The Florida Office of Insurance Regulation told the House committee on Thursday that no company had sought a rate hike of more than 10 percent in the last two years.
And the state's auto insurer of last resort only has 6,000 policies, compared with the 800,000 policies it had in the 1970s when the no-fault law was enacted.
Even though the House and Senate bills reenact the no-fault law, the issue is all but certain to come up again. The bills would force it to sunset again, the Senate's in 2009 and the House's in 2012.
Palm Beach Post Staff Writer
Friday, March 31, 2006
It appears Florida's system of paying for medical care after a car crash will stay in place for at least another year.
On Thursday, the House Insurance Committee passed a bill that would reenact Florida's no-fault system, which was scheduled to sunset next year.
The Senate Banking and Insurance Committee also passed a bill renewing no-fault on Tuesday.
Both make some reforms to the system, though not as many as the insurance industry wants.
At issue is the required personal injury protection, or PIP, part of auto insurance policies. It provides $10,000 in medical care, disability and death benefits for a person after an auto accident, regardless of who is at fault.
In states without no-fault laws, health insurers pay for medical care after an accident, and people must sue to recover other costs like lost pay.
Rampant fraud and abuse led lawmakers to enact reforms in 2001 and 2003, and finally to vote to repeal the no-fault law on Oct. 1, 2007, unless it was renewed this year.
The no-fault law has been hotly contested, partly because the insurance industry is split over it. Some large insurers, like State Farm, Allstate and Nationwide, want to see the law repealed.
Others, like Progressive and Geico, want to see it renewed with significant changes, like medical fee schedules for doctors and limits on attorney fees. Those reforms have met strong resistance from doctors who care for car crash victims and lawyers who sue insurance companies.
All groups have been aggressively lobbying lawmakers. Rep. Dennis Ross, R-Lakeland, chairman of the House Insurance Committee, said his chamber's bill strikes a balance.
"I think we've been very, very sensitive to the health care providers out there," he said. "This doesn't affect what you charge. It does not prohibit attorneys' fees. This is a compromise... necessary in order to continue to move these issues forward."
The House bill would require PIP to pay an additional $10,000 just for emergency room care, leaving victims with another $10,000 for other care. It would also forbid attorneys from multiplying their fees except in certain situations and require motorcyclists between the ages of 16 and 20 to have insurance, including PIP. The bill would also make it a felony to create fake accidents on paper.
The Senate bill passed Tuesday included about $3.3 million in state money to give pay raises to state fraud investigators, hire as many as 19 new investigators and hire six new insurance fraud prosecutors.
The state Division of Insurance Fraud has said it regularly loses investigators to the Florida Department of Law Enforcement, which pays better.
In spite of PIP fraud, auto insurance rates are competitive.
The Florida Office of Insurance Regulation told the House committee on Thursday that no company had sought a rate hike of more than 10 percent in the last two years.
And the state's auto insurer of last resort only has 6,000 policies, compared with the 800,000 policies it had in the 1970s when the no-fault law was enacted.
Even though the House and Senate bills reenact the no-fault law, the issue is all but certain to come up again. The bills would force it to sunset again, the Senate's in 2009 and the House's in 2012.
Thursday, March 30, 2006
Health Insurance policy sold in Spanish, issued in English
By LISA GIRION
Los Angeles Times
When she learned the cost of an operation that opened her husband's clogged arteries last fall, Maria Rodriguez was glad she had signed the couple up for health coverage several weeks earlier.
But then Blue Cross of California said Raudel Rodriguez, a 53-year-old self-employed scrap-metal hauler, had failed to disclose pre-existing conditions — including chest pain — that made him uninsurable. The company canceled his coverage, returned $1,700 in premiums and left the couple instead with a $130,000 hospital bill.
The Rodriguezes insist they answered the Blue Cross salesman's questions honestly in a telephone conversation in Spanish. If anything was amiss with the husband's application, they say, the fault lies with Blue Cross because the company filled out their applications in English, a language they do not understand.
Blue Cross, a unit of Well-Point, declined to comment.
With a lawsuit accusing Blue Cross of reneging, the Santa Ana, Calif., couple has raised an issue that experts say could plague the health insurance industry in coming years as it increasingly reaches out to cover immigrants: Insurers could face legal problems unless they make sure they are doing business with customers in a language they understand.
A dramatic impact
The case "could have a very dramatic impact in terms of elevating awareness on the part of (health) plans to make sure that they are communicating in the appropriate language with all their members and not just assuming contracts in English are going to be understood," said Gerald Kominski, a professor at the University of California, Los Angeles, School of Public Health.
Kominski is an author of a new study that found that as many as 10 percent of HMO members in California speak no English or have limited proficiency. "They pay their premiums," he said, "and they are entitled to the same level of service as English-speaking members."
Under current law, however, non-English speakers have fewer safeguards when buying health coverage than they do when buying a car or renting an apartment.
Auto dealers and other retailers that sell products with financing have long been required to put contracts in Spanish if that is the language used to make the deal, said Alejandra Cedillo, a Los Angeles County Neighborhood Legal Services lawyer. That protection recently was expanded to consumers who speak Asian languages.
"There's nothing that would apply to health insurance," she said.
That's about to change. The state Department of Managed Health Care expects to finalize rules this year that would require health plans to put key documents in the consumer's primary language and to pay for interpreters to accompany patients to doctors' offices and hospitals.
TV ad was in Spanish
For Maria Rodriguez, it was a Spanish-language television commercial that prompted her call to Blue Cross last summer. She said she spoke to an agent who described the plan and asked questions about the couple's medical history — all in Spanish.
The couple said Raudel had complained of chest pain early last year. But his physician had diagnosed heartburn, and they had no reason to believe it was anything more significant.
Applications for coverage — one for each of them — arrived in the mail already filled out in English, making it impossible for them to verify the accuracy of the responses. The couple said they signed nonetheless. They began paying premiums of more than $500 every other month on Raudel's policy, which took effect Aug. 1. The couple pays almost $500 every other month on a separate policy for Maria, which remains in effect.
A couple of weeks later, Raudel felt chest pain again and went to the doctor. The physician ordered tests but found nothing wrong, the Rodriguezes said.
Finally, after the pains continued, a cardiologist ordered a test that showed for the first time that he had coronary problems, the couple said. The cardiologist told the couple that if Raudel did not have surgery, he could have a heart attack.
"I told my husband, 'Thank God we got that policy,' " Maria said.
Raudel had the operation in mid-September, spent three days in the hospital and went home. A few days before Christmas, Blue Cross canceled their coverage retroactively, citing information it had discovered in Raudel's medical records.
The couple had no idea what the notification letter was about because it was in English. It was not until Raudel went in for a follow-up visit with his physician that they learned that he no longer was covered.
'Cried every day'
"We cried every day for more than a month," Maria said.
Then they found a lawyer. Jess Araujo, who practices in Santa Ana, contends that the case shows that Blue Cross takes advantage of customers who cannot speak English.
"They want to speak Spanish to hook you in, but then they want to make sure they put the contract in English," Araujo said. "Why do that? There's no shortage of interpreters."
Language is not the only problem in this case, said Robert Gianelli, a Los Angeles lawyer who specializes in insurance cases and is also representing the couple. He contends that Blue Cross is using the benefit of hindsight to discern a pattern in Raudel's medical record that his physician at the time did not.
Moreover, he said, the company examined the Rodriguez case with a microscope only to avoid paying for expensive care — an illegal practice known as "post-claims underwriting."
The Rodriguezes said if they lose, to pay the hospital bill they would have to sell the home in which they raised three children, and Raudel might never receive the follow-up care his doctors had ordered.
Los Angeles Times
When she learned the cost of an operation that opened her husband's clogged arteries last fall, Maria Rodriguez was glad she had signed the couple up for health coverage several weeks earlier.
But then Blue Cross of California said Raudel Rodriguez, a 53-year-old self-employed scrap-metal hauler, had failed to disclose pre-existing conditions — including chest pain — that made him uninsurable. The company canceled his coverage, returned $1,700 in premiums and left the couple instead with a $130,000 hospital bill.
The Rodriguezes insist they answered the Blue Cross salesman's questions honestly in a telephone conversation in Spanish. If anything was amiss with the husband's application, they say, the fault lies with Blue Cross because the company filled out their applications in English, a language they do not understand.
Blue Cross, a unit of Well-Point, declined to comment.
With a lawsuit accusing Blue Cross of reneging, the Santa Ana, Calif., couple has raised an issue that experts say could plague the health insurance industry in coming years as it increasingly reaches out to cover immigrants: Insurers could face legal problems unless they make sure they are doing business with customers in a language they understand.
A dramatic impact
The case "could have a very dramatic impact in terms of elevating awareness on the part of (health) plans to make sure that they are communicating in the appropriate language with all their members and not just assuming contracts in English are going to be understood," said Gerald Kominski, a professor at the University of California, Los Angeles, School of Public Health.
Kominski is an author of a new study that found that as many as 10 percent of HMO members in California speak no English or have limited proficiency. "They pay their premiums," he said, "and they are entitled to the same level of service as English-speaking members."
Under current law, however, non-English speakers have fewer safeguards when buying health coverage than they do when buying a car or renting an apartment.
Auto dealers and other retailers that sell products with financing have long been required to put contracts in Spanish if that is the language used to make the deal, said Alejandra Cedillo, a Los Angeles County Neighborhood Legal Services lawyer. That protection recently was expanded to consumers who speak Asian languages.
"There's nothing that would apply to health insurance," she said.
That's about to change. The state Department of Managed Health Care expects to finalize rules this year that would require health plans to put key documents in the consumer's primary language and to pay for interpreters to accompany patients to doctors' offices and hospitals.
TV ad was in Spanish
For Maria Rodriguez, it was a Spanish-language television commercial that prompted her call to Blue Cross last summer. She said she spoke to an agent who described the plan and asked questions about the couple's medical history — all in Spanish.
The couple said Raudel had complained of chest pain early last year. But his physician had diagnosed heartburn, and they had no reason to believe it was anything more significant.
Applications for coverage — one for each of them — arrived in the mail already filled out in English, making it impossible for them to verify the accuracy of the responses. The couple said they signed nonetheless. They began paying premiums of more than $500 every other month on Raudel's policy, which took effect Aug. 1. The couple pays almost $500 every other month on a separate policy for Maria, which remains in effect.
A couple of weeks later, Raudel felt chest pain again and went to the doctor. The physician ordered tests but found nothing wrong, the Rodriguezes said.
Finally, after the pains continued, a cardiologist ordered a test that showed for the first time that he had coronary problems, the couple said. The cardiologist told the couple that if Raudel did not have surgery, he could have a heart attack.
"I told my husband, 'Thank God we got that policy,' " Maria said.
Raudel had the operation in mid-September, spent three days in the hospital and went home. A few days before Christmas, Blue Cross canceled their coverage retroactively, citing information it had discovered in Raudel's medical records.
The couple had no idea what the notification letter was about because it was in English. It was not until Raudel went in for a follow-up visit with his physician that they learned that he no longer was covered.
'Cried every day'
"We cried every day for more than a month," Maria said.
Then they found a lawyer. Jess Araujo, who practices in Santa Ana, contends that the case shows that Blue Cross takes advantage of customers who cannot speak English.
"They want to speak Spanish to hook you in, but then they want to make sure they put the contract in English," Araujo said. "Why do that? There's no shortage of interpreters."
Language is not the only problem in this case, said Robert Gianelli, a Los Angeles lawyer who specializes in insurance cases and is also representing the couple. He contends that Blue Cross is using the benefit of hindsight to discern a pattern in Raudel's medical record that his physician at the time did not.
Moreover, he said, the company examined the Rodriguez case with a microscope only to avoid paying for expensive care — an illegal practice known as "post-claims underwriting."
The Rodriguezes said if they lose, to pay the hospital bill they would have to sell the home in which they raised three children, and Raudel might never receive the follow-up care his doctors had ordered.
Esurance Makes Auto Insurance Shopping Easier
Press Release
SAN FRANCISCO, March 29 /PRNewswire/ -- Esurance, the direct-to-consumer auto insurance company, is breaking new ground with its strategic partner, Answer Financial. When customers get a quote from Esurance, they can also view real-time comparison quotes and buy a competitor's policy. Answer Financial provides the engine that facilitates Esurance's real-time comparisons and purchases.
Gary Tolman, Esurance's President and CEO, feels that the initiative represents an extension of the company's core commitment -- to improve the entire auto insurance experience from quote to claim. Tolman stated, "Esurance was one of the first auto insurance companies to offer instant rate comparisons online. Though we always thought it was beneficial for consumers to see rate comparisons, we feel it's even more beneficial to help consumers act on them."
Alan Snyder, CEO and founder of Answer Financial, noted, "Some auto insurance companies' Web sites provide a view of what their competitors charge. However, Esurance may be the first direct writer to give consumers the ability to buy a competitor's policy through its own site. The future is here."
Tolman added that auto insurance shoppers also save time with the new feature. "Drivers don't want to spend a second longer than they have to on auto insurance. With our comparison quotes enhancement, we take a few steps out of the shopping process. Our partner, Answer Financial, provides a very broad offering that will serve almost anyone who comes to our site," Tolman explained.
To coincide with the rollout of enhanced comparison quoting, Esurance has also launched the latest installment in its national television advertising campaign. The 30-second spot, "Quick Draw," features animated spokesperson, Erin Esurance, in a futuristic, western-themed setting. In the spot, Erin highlights the new auto insurance comparison feature.
SAN FRANCISCO, March 29 /PRNewswire/ -- Esurance, the direct-to-consumer auto insurance company, is breaking new ground with its strategic partner, Answer Financial. When customers get a quote from Esurance, they can also view real-time comparison quotes and buy a competitor's policy. Answer Financial provides the engine that facilitates Esurance's real-time comparisons and purchases.
Gary Tolman, Esurance's President and CEO, feels that the initiative represents an extension of the company's core commitment -- to improve the entire auto insurance experience from quote to claim. Tolman stated, "Esurance was one of the first auto insurance companies to offer instant rate comparisons online. Though we always thought it was beneficial for consumers to see rate comparisons, we feel it's even more beneficial to help consumers act on them."
Alan Snyder, CEO and founder of Answer Financial, noted, "Some auto insurance companies' Web sites provide a view of what their competitors charge. However, Esurance may be the first direct writer to give consumers the ability to buy a competitor's policy through its own site. The future is here."
Tolman added that auto insurance shoppers also save time with the new feature. "Drivers don't want to spend a second longer than they have to on auto insurance. With our comparison quotes enhancement, we take a few steps out of the shopping process. Our partner, Answer Financial, provides a very broad offering that will serve almost anyone who comes to our site," Tolman explained.
To coincide with the rollout of enhanced comparison quoting, Esurance has also launched the latest installment in its national television advertising campaign. The 30-second spot, "Quick Draw," features animated spokesperson, Erin Esurance, in a futuristic, western-themed setting. In the spot, Erin highlights the new auto insurance comparison feature.
Wednesday, March 29, 2006
Regulators warn about fake health insurance
NEW YORK (Reuters) - The National Association of Insurance Commissioners said on Tuesday it is launching a campaign to warn businesses and employees about frauds offering fake health insurance.
Phony carriers hawking fraudulent coverage have cost employers and workers more than a quarter of a billion dollars, said Alessandro Iuppa, NAIC President and Superintendent of the Maine Bureau of Insurance.
"A single claim for a premature child could be over half a million dollars," said Iuppa. "A worker may think he had insurance for this and find out he hasn't.
A 2004 study by the U.S. Government Accountability Office found more than 15,000 businesses and 200,000 employees were victimized in a period from 2000 through 2002, and at least $252 million in claims went unpaid.
Iuppa said it was hard to track these health insurance frauds because his organization is set up to monitor licensed providers, and fake carriers usually are unlicensed.
NAIC is launching a radio and television campaign urging employers and workers to call their state insurance regulator to confirm the company and broker selling the policy are licensed.
NAIC is meeting in New York this week.
Phony carriers hawking fraudulent coverage have cost employers and workers more than a quarter of a billion dollars, said Alessandro Iuppa, NAIC President and Superintendent of the Maine Bureau of Insurance.
"A single claim for a premature child could be over half a million dollars," said Iuppa. "A worker may think he had insurance for this and find out he hasn't.
A 2004 study by the U.S. Government Accountability Office found more than 15,000 businesses and 200,000 employees were victimized in a period from 2000 through 2002, and at least $252 million in claims went unpaid.
Iuppa said it was hard to track these health insurance frauds because his organization is set up to monitor licensed providers, and fake carriers usually are unlicensed.
NAIC is launching a radio and television campaign urging employers and workers to call their state insurance regulator to confirm the company and broker selling the policy are licensed.
NAIC is meeting in New York this week.
Getting smart on auto insurance
BY ELIZABETH LAZAROWITZ
DAILY NEWS BUSINESS WRITER
The National Association of Insurance Commissioners is offering consumers information on home, health, life and auto insurance.
If you spent more time researching your new flat-screen television purchase than you did picking out your health insurance plan, you're not alone.
A fifth of young singles say they would let their auto insurance lapse to save cash, even though they need to have it by law. And half of older families didn't know what happens to their health insurance when they leave a job, according to a poll released yesterday by the National Association of Insurance Commissioners.
To combat some of these potentially damaging insurance mistakes, the NAIC debuted a public education campaign yesterday.
"By its nature, (an insurance policy) is a complex product - some more complex that others - and this is an effort to raise the knowledge of people, regardless of what stage of life they're in," said NAIC president Alessandro Iuppa. "No one is born with an innate knowledge of insurance."
The organization, which is made up of insurance regulators from around the country, is offering information tailored to four groups - "young singles," "young families," "established families," and "empty nesters" - on a new insureuonline.org Web site. Each area offers information and tips on home, health, life and auto insurance. Also, visitors to the Web site can take quizzes on what they learn.
Younger, single people living on their own should consider renters' insurance to protect their property and to shield them from lawsuits since, in many states, they can be held liable if anyone is hurt during or after a party at the home when alcohol is served, the NAIC said.
Younger people also sometimes forego health or disability insurance, which can be financially devastating if they get hurt or become ill, said Diane Koken, Commissioner of the Pennsylvania Insurance Department.
"There's this believe that they're invincible," she said.
For college kids, keeping up good grades will convince some companies to lower their auto insurance premiums. Younger people should also check out insurance costs before they purchase a vehicle, since premiums vary with the type and model of car.
On the other end of the spectrum, seniors may want to scale back their homeowners' coverage if they've decided to downsize their living space, and retirees may be eligible for discounted insurance, since it's assumed they're more likely to be home and watching over their stuff.
While it's important to shop around for the best deal on any policy, watch out for something that seems too good to be true, NAIC CEO Catherine Weatherford said.
Policies that cost 15% to 20% less than others with comparable coverage should set off an alarm, as well as overly aggressive salesmen and unlisted phone numbers, the NAIC said.
Before you sign a policy and hand over a check, you can call 1-866-470-NAIC to find out if both the company and the agent are licensed to sell the kind of insurance you're about to buy.
You can also find out about any complaints filed against the agent and how the company has handled complaints in the past.
DAILY NEWS BUSINESS WRITER
The National Association of Insurance Commissioners is offering consumers information on home, health, life and auto insurance.
If you spent more time researching your new flat-screen television purchase than you did picking out your health insurance plan, you're not alone.
A fifth of young singles say they would let their auto insurance lapse to save cash, even though they need to have it by law. And half of older families didn't know what happens to their health insurance when they leave a job, according to a poll released yesterday by the National Association of Insurance Commissioners.
To combat some of these potentially damaging insurance mistakes, the NAIC debuted a public education campaign yesterday.
"By its nature, (an insurance policy) is a complex product - some more complex that others - and this is an effort to raise the knowledge of people, regardless of what stage of life they're in," said NAIC president Alessandro Iuppa. "No one is born with an innate knowledge of insurance."
The organization, which is made up of insurance regulators from around the country, is offering information tailored to four groups - "young singles," "young families," "established families," and "empty nesters" - on a new insureuonline.org Web site. Each area offers information and tips on home, health, life and auto insurance. Also, visitors to the Web site can take quizzes on what they learn.
Younger, single people living on their own should consider renters' insurance to protect their property and to shield them from lawsuits since, in many states, they can be held liable if anyone is hurt during or after a party at the home when alcohol is served, the NAIC said.
Younger people also sometimes forego health or disability insurance, which can be financially devastating if they get hurt or become ill, said Diane Koken, Commissioner of the Pennsylvania Insurance Department.
"There's this believe that they're invincible," she said.
For college kids, keeping up good grades will convince some companies to lower their auto insurance premiums. Younger people should also check out insurance costs before they purchase a vehicle, since premiums vary with the type and model of car.
On the other end of the spectrum, seniors may want to scale back their homeowners' coverage if they've decided to downsize their living space, and retirees may be eligible for discounted insurance, since it's assumed they're more likely to be home and watching over their stuff.
While it's important to shop around for the best deal on any policy, watch out for something that seems too good to be true, NAIC CEO Catherine Weatherford said.
Policies that cost 15% to 20% less than others with comparable coverage should set off an alarm, as well as overly aggressive salesmen and unlisted phone numbers, the NAIC said.
Before you sign a policy and hand over a check, you can call 1-866-470-NAIC to find out if both the company and the agent are licensed to sell the kind of insurance you're about to buy.
You can also find out about any complaints filed against the agent and how the company has handled complaints in the past.
Tuesday, March 28, 2006
Texas' health insurance adds dental coverage
Children participating in the Texas health insurance program will be able to see a dentist beginning Saturday under a new plan.
Many services to the CHIP Program were cut fore budget reasons, but lawmakers restored dental coverage and vision coverage last year. Confusion over new enrollment policies have left many families without coverage for their children.
CHIP provides insurance for children in families that make too much to qualify for Medicaid, but not enough to afford private insurance.
Many services to the CHIP Program were cut fore budget reasons, but lawmakers restored dental coverage and vision coverage last year. Confusion over new enrollment policies have left many families without coverage for their children.
CHIP provides insurance for children in families that make too much to qualify for Medicaid, but not enough to afford private insurance.
Fewer automobile thefts may not affect auto insurance rates
By Rex Hall Jr.
rhall@kalamazoogazette.com
A sharp decline in automobile thefts in Kalamazoo County is encouraging but not likely to immediately affect automobile insurance rates, a representative with the Michigan Association of Insurance Agents says.
Rates are determined by several factors, including frequency and severity of accidents in a particular area, litigation and medical costs, population and vehicle-replacement costs, MAIA spokesman Gary Mitchell said.
``It's not a real scientific formula,'' he said. ``A short-term drop in auto theft is unlikely to have any significant impact on auto-insurance rates. However, if there is a noticeable trend, that's the kind of thing insurance companies look at.''
A decrease in auto thefts over an extended period -- often up to five years -- could eventually push insurance rates down, Mitchell said.
rhall@kalamazoogazette.com
A sharp decline in automobile thefts in Kalamazoo County is encouraging but not likely to immediately affect automobile insurance rates, a representative with the Michigan Association of Insurance Agents says.
Rates are determined by several factors, including frequency and severity of accidents in a particular area, litigation and medical costs, population and vehicle-replacement costs, MAIA spokesman Gary Mitchell said.
``It's not a real scientific formula,'' he said. ``A short-term drop in auto theft is unlikely to have any significant impact on auto-insurance rates. However, if there is a noticeable trend, that's the kind of thing insurance companies look at.''
A decrease in auto thefts over an extended period -- often up to five years -- could eventually push insurance rates down, Mitchell said.
Monday, March 27, 2006
Aging boomers face high cost of individual health insurance
Lack of health insurance is a scary reality for a lot of Americans, but it can be even more nerve-wracking for those who are between the ages of 50 and 64. It's a period in life when health problems often increase and the need for insurance escalates. But people in that age group are too young for Medicare. And if they don't get health insurance from an employer, a private policy could be out of reach-- either because of medical history or prohibitive costs.
St. Paul, Minn. — In an era when it's getting harder to bank on steady employment and health care benefits, Joe Pallansch of Minneapolis has learned to prepare for the worst. Pallansch is in his mid-fifties. And in the course of his career in the manufacturing industry, he's been laid off four times, including for a time starting last May.
It had been about 20 years since Pallansch's last layoff, and back in the 1980s, it wasn't the end of the world. He says he knew he'd get more work and wasn't overwhelmed by the cost of purchasing individual health insurance in between jobs.
"I was able to spend $50 to $60 a month for basic protective insurance," he says. "You bought it quarterly, three months at a time."
But by the time of his most recent layoff this past year, Pallansch was considerably older. His wife Deborah, also in her fifties, doesn't get health insurance through her work. So when Joe lost his job, they lost two thirds of their income and their health coverage. And they had to start researching the cost of buying insurance themselves.
They were alarmed by what they found. One option was to pay for an extension of Joe's past health care benefits, which was about $1,100 a month).
"But we couldn't afford it with unemployment," Pallansch explains.
The Pallansches earned too much to qualify for Minnesota Care, the state's subsidized health insurance for low and moderate income Minnesotans. So they applied for individual health plans with a couple of different companies.
The Pallansches consider themselves to be in good health. Their worst problems are Joe's high blood pressure and Deb's sinus problems. Nevertheless, Blue Cross and Blue Shield of Minnesota turned them down without saying why. And Deb says their other health insurance option, with HealthPartners, came with both a high deductible and sticker shock.
"I just wasn't prepared for what the price was going to be," she says. "The premiums were $532 for the two of us, with a $10,000 a year deductible."
The barriers to health insurance Joe and Deborah Pallansch encountered are typical for many aging baby boomers who aren't insured through an employer. And they reflect a number of issues in health care.
Andrea Walsh, a top executive at HealthPartners, says, for one thing, the health insurance market isn't designed to serve the needs of individual consumers. Instead, it's set up primarily for employers buying health plans for workers. Walsh says it's costly to insure individuals because so often they only want insurance for a limited period of time--generally when they're between jobs, and they tend to have more health problems.
In any case, she says, the older you get, the more expensive your health care needs are.
"The annual medical costs for a man age 55-59 are about 5 times the medical costs for a male that's aged 20-25," Walsh says.
John Rother, the policy director of AARP, which advocates for older Americans, says the reason is no mystery: advancing age can result in declining health.
"In a private insurance market, insurers are really motivated to insure healthy people, not sick people. And as you get older you're much more likely to have had a cancer diagnosis or heart problems or diabetes or something like that," he says.
Rother says flat-out denial of coverage is common among individuals who lose benefits in the last decade before they hit age 65.
"It's not technically age discrimination, but if you look at the consequence, people who are in their 50's and 60's, when they most need health insurance, can't get it," Rother says.
Most states do have a back-up for people who have been denied health insurance by the private market. In Minnesota, the non-profit Minnesota Comprehensive Health Association, or MCHA, covers individuals that private insurers consider to be too high-risk.
MCHA serves 30,000 Minnesotans who have been denied private insurance for any of a number of reasons, including pre-existing conditions. But the hitch is, MCHA policies tend to cost about 20 percent more than the market rate.
MCHA could have been an option for Joe and Deb Pallansch, since they were denied coverage by one insurer. But whether they went with MCHA or a private insurer their costs would still be pretty high, simply because of their age.
"Unfortunately, the ratings continue to get higher in the upper age groups," says Cheryl Frolund, the director of Small Group Sales at Blue Cross and Blue Shield of Minnesota.
Froland says insurance rates increase according to age because of Minnesota's laws. She says the state Legislature made the decision that individual policies would be tied to age categories, and that means insurance may be very expensive for some people.
But Frolund says the alternative to age-rated policies isn't great either. She says some states, particularly on the East Coast, offer what are called community-rated plans. Those plans charge uniform premiums, regardless of age. Frolund says, as a result, people at the other end of the age spectrum sometimes balk at the price.
"So what's happened on the east coast is you'll have a rate of $400-$500 a month, whether you're 25 years old or 55 years old. And unfortunately what you'll find out there is a much higher population of uninsureds," Frolund says. "Younger people are not going to pay those higher rates, so they just go without insurance if they don't have it available to them through their employer."
Community rating may bring down the cost of insurance for older people. But it's not a silver bullet, according to AARP's senior policy adviser, Gerry Smolka.
She says older people in states with age-based rating like Minnesota have to pay more for individual health insurance, but that doesn't mean more older people in those states are going without insurance overall. Minnesota, Iowa, and Wisconsin, for example, have a lower percentage of uninsured people age 50 to 64 -- only about 8 percent to 9 percent-- compared to the national average of 13 percent.
Smolka says the reason is hard to pin down. "It speaks as much to insurance in the state overall, and the economy, and how many people have insurance through employers," she says. "Income, immigration, all those things are factors in whether people have health insurance, since the vast majority of us have health insurance through our employers."
But Smolka says regardless of the causes, a lot of people in their fifties and sixties are left having to pay high prices for individual insurance plans.
There's no clear solution to the problem. HealthPartners says one way to reduce premium costs would be to require that everyone have health insurance-- that way more healthy people would be contributing towards the cost of treating the sick.
Blue Cross and Blue Shield of Minnesota says the expansion of consumer driven health plans, which involve high deductible policies, will help bring costs down because they discourage frivolous use of the health care system.
Joe Pallansch has his own approach. For now, his huge health insurance bills are a thing of the past. He has a job again, and his employer pays for his health coverage. But Pallansch says he's preparing himself for the possibility of getting laid off again. That means taking full advantage of health insurance now.
"You need to not put stuff off, like [when] you need to go to the doctor. For example, I needed a tooth filled. If there's something in your life you need to correct, you need to do that," he says.
And he's taking another precaution that's not always easy to do: He's squirreling away as much money as possible so that if he ever does have to buy insurance again before he qualifies for Medicare, the costs won't sink him.
St. Paul, Minn. — In an era when it's getting harder to bank on steady employment and health care benefits, Joe Pallansch of Minneapolis has learned to prepare for the worst. Pallansch is in his mid-fifties. And in the course of his career in the manufacturing industry, he's been laid off four times, including for a time starting last May.
It had been about 20 years since Pallansch's last layoff, and back in the 1980s, it wasn't the end of the world. He says he knew he'd get more work and wasn't overwhelmed by the cost of purchasing individual health insurance in between jobs.
"I was able to spend $50 to $60 a month for basic protective insurance," he says. "You bought it quarterly, three months at a time."
But by the time of his most recent layoff this past year, Pallansch was considerably older. His wife Deborah, also in her fifties, doesn't get health insurance through her work. So when Joe lost his job, they lost two thirds of their income and their health coverage. And they had to start researching the cost of buying insurance themselves.
They were alarmed by what they found. One option was to pay for an extension of Joe's past health care benefits, which was about $1,100 a month).
"But we couldn't afford it with unemployment," Pallansch explains.
The Pallansches earned too much to qualify for Minnesota Care, the state's subsidized health insurance for low and moderate income Minnesotans. So they applied for individual health plans with a couple of different companies.
The Pallansches consider themselves to be in good health. Their worst problems are Joe's high blood pressure and Deb's sinus problems. Nevertheless, Blue Cross and Blue Shield of Minnesota turned them down without saying why. And Deb says their other health insurance option, with HealthPartners, came with both a high deductible and sticker shock.
"I just wasn't prepared for what the price was going to be," she says. "The premiums were $532 for the two of us, with a $10,000 a year deductible."
The barriers to health insurance Joe and Deborah Pallansch encountered are typical for many aging baby boomers who aren't insured through an employer. And they reflect a number of issues in health care.
Andrea Walsh, a top executive at HealthPartners, says, for one thing, the health insurance market isn't designed to serve the needs of individual consumers. Instead, it's set up primarily for employers buying health plans for workers. Walsh says it's costly to insure individuals because so often they only want insurance for a limited period of time--generally when they're between jobs, and they tend to have more health problems.
In any case, she says, the older you get, the more expensive your health care needs are.
"The annual medical costs for a man age 55-59 are about 5 times the medical costs for a male that's aged 20-25," Walsh says.
John Rother, the policy director of AARP, which advocates for older Americans, says the reason is no mystery: advancing age can result in declining health.
"In a private insurance market, insurers are really motivated to insure healthy people, not sick people. And as you get older you're much more likely to have had a cancer diagnosis or heart problems or diabetes or something like that," he says.
Rother says flat-out denial of coverage is common among individuals who lose benefits in the last decade before they hit age 65.
"It's not technically age discrimination, but if you look at the consequence, people who are in their 50's and 60's, when they most need health insurance, can't get it," Rother says.
Most states do have a back-up for people who have been denied health insurance by the private market. In Minnesota, the non-profit Minnesota Comprehensive Health Association, or MCHA, covers individuals that private insurers consider to be too high-risk.
MCHA serves 30,000 Minnesotans who have been denied private insurance for any of a number of reasons, including pre-existing conditions. But the hitch is, MCHA policies tend to cost about 20 percent more than the market rate.
MCHA could have been an option for Joe and Deb Pallansch, since they were denied coverage by one insurer. But whether they went with MCHA or a private insurer their costs would still be pretty high, simply because of their age.
"Unfortunately, the ratings continue to get higher in the upper age groups," says Cheryl Frolund, the director of Small Group Sales at Blue Cross and Blue Shield of Minnesota.
Froland says insurance rates increase according to age because of Minnesota's laws. She says the state Legislature made the decision that individual policies would be tied to age categories, and that means insurance may be very expensive for some people.
But Frolund says the alternative to age-rated policies isn't great either. She says some states, particularly on the East Coast, offer what are called community-rated plans. Those plans charge uniform premiums, regardless of age. Frolund says, as a result, people at the other end of the age spectrum sometimes balk at the price.
"So what's happened on the east coast is you'll have a rate of $400-$500 a month, whether you're 25 years old or 55 years old. And unfortunately what you'll find out there is a much higher population of uninsureds," Frolund says. "Younger people are not going to pay those higher rates, so they just go without insurance if they don't have it available to them through their employer."
Community rating may bring down the cost of insurance for older people. But it's not a silver bullet, according to AARP's senior policy adviser, Gerry Smolka.
She says older people in states with age-based rating like Minnesota have to pay more for individual health insurance, but that doesn't mean more older people in those states are going without insurance overall. Minnesota, Iowa, and Wisconsin, for example, have a lower percentage of uninsured people age 50 to 64 -- only about 8 percent to 9 percent-- compared to the national average of 13 percent.
Smolka says the reason is hard to pin down. "It speaks as much to insurance in the state overall, and the economy, and how many people have insurance through employers," she says. "Income, immigration, all those things are factors in whether people have health insurance, since the vast majority of us have health insurance through our employers."
But Smolka says regardless of the causes, a lot of people in their fifties and sixties are left having to pay high prices for individual insurance plans.
There's no clear solution to the problem. HealthPartners says one way to reduce premium costs would be to require that everyone have health insurance-- that way more healthy people would be contributing towards the cost of treating the sick.
Blue Cross and Blue Shield of Minnesota says the expansion of consumer driven health plans, which involve high deductible policies, will help bring costs down because they discourage frivolous use of the health care system.
Joe Pallansch has his own approach. For now, his huge health insurance bills are a thing of the past. He has a job again, and his employer pays for his health coverage. But Pallansch says he's preparing himself for the possibility of getting laid off again. That means taking full advantage of health insurance now.
"You need to not put stuff off, like [when] you need to go to the doctor. For example, I needed a tooth filled. If there's something in your life you need to correct, you need to do that," he says.
And he's taking another precaution that's not always easy to do: He's squirreling away as much money as possible so that if he ever does have to buy insurance again before he qualifies for Medicare, the costs won't sink him.
MI Motorists Will See Relief for Car Insurance
Good news for Michigan motorists- your car insurance is going down, but only a little bit. A state claims board agreed to lower the amount that each car owner pays to a fund that supports seriously injured accident victims. Starting this July, you'll pay $137 to that fund for each insured vehicle. That's four dollars less than before.
Friday, March 24, 2006
Michigan Legislative Panel OKs Health Insurance Conscience Clause
(LifeNews.com) -- A Michigan state House panel approved legislation Thursday that would provide a conscience clause for insurance companies. The measure would help companies that don't want to cover abortions or the morning after pill, for example, from being forced to do so.
The legislation helps insurance providers and HMO opt out of providing coverage for any service or benefit that conflicts with the companies moral or religious beliefs.
Sponsored by Rep. Scott Hummel, a Republican, the bill would help specialized Catholic insurance plans or other agencies if their objections are reflected in their mission statement or articles of incorporation.
The measure received a favorable vote from the House Insurance Committee, which approved it on a party-line 9-6 vote and it now heads to the full House. Republicans backed the bill while Democrats voted against it.
Abortion advocates oppose the bill and claim it will reduce health benefits for consumers and limit women's access to the morning after pill.
But the measure enjoys the support of the Michigan Catholic Conference and Right to Life of Michigan.
Backer of the bill say it is important for abortion and the Plan B drugs, which can sometimes cause an abortion, but will be increasingly important as bioethics issues like human cloning and embryonic stem cell research take shape.
"This is a forward-thinking piece of legislation," said Ed Rivet, legislative director for Right to Life of Michigan, told the Associated Press. "If an insurer does not want to cover something -- consistent with previously established values or mission statements -- that should be protected."
The insurance bill is in two parts and is HB 4745 and HB 4746.
The legislation helps insurance providers and HMO opt out of providing coverage for any service or benefit that conflicts with the companies moral or religious beliefs.
Sponsored by Rep. Scott Hummel, a Republican, the bill would help specialized Catholic insurance plans or other agencies if their objections are reflected in their mission statement or articles of incorporation.
The measure received a favorable vote from the House Insurance Committee, which approved it on a party-line 9-6 vote and it now heads to the full House. Republicans backed the bill while Democrats voted against it.
Abortion advocates oppose the bill and claim it will reduce health benefits for consumers and limit women's access to the morning after pill.
But the measure enjoys the support of the Michigan Catholic Conference and Right to Life of Michigan.
Backer of the bill say it is important for abortion and the Plan B drugs, which can sometimes cause an abortion, but will be increasingly important as bioethics issues like human cloning and embryonic stem cell research take shape.
"This is a forward-thinking piece of legislation," said Ed Rivet, legislative director for Right to Life of Michigan, told the Associated Press. "If an insurer does not want to cover something -- consistent with previously established values or mission statements -- that should be protected."
The insurance bill is in two parts and is HB 4745 and HB 4746.
Most expensive and cheapest cars to insure - Mar 23, 2006
From CNN Money
The Ford F-series pick-up, which consistently ranks as America's most popular vehicle, is also the most expensive to insure among the top 20, according to a report released today by the insurance website Insure.com.
The Chrysler Town & Country minivan is the least expensive to insure of the 20 most popular vehicles, while its corporate twin, the Dodge Caravan, is the third least expensive. The Chevrolet Cobalt small car is the second least expensive to insure, according to the report.
Any individual's actual car insurance premiums can vary greatly depending on factors such as their age, driving record and where they live. But the vehicle itself is a major factor that insurance companies consider to determine premiums.
Insurance is the third largest cost of owning a new car, after depreciation and fuel, according to Insure.com. Insurance premium costs, now averaging almost $900 per year, have risen 27 percent since 2000, according to the report.
Insure.com looked only at the 20 top-selling vehicles in the United States.
In order to rank the vehicles by their relative costs to insure, Insure.com compared rates provided by the website Esurance.com for a 45-year-old single male with no traffic violations who drives less than three miles to work. The amounts of coverage were also the same for each vehicle. Premiums for three different cities, one on the East Coast, one on the West Coast and one in the Midwest, were averaged for each vehicle.
Factors such as popularity with car thieves, how much the vehicle costs to repair after a crash and the amount of damage it does to another vehicle in a crash can influence a vehicles cost to insure, said Loretta Worters, vice president of the Insurance Information Institute.
Options, such as a bigger engine or a high-performance trim level, can make one vehicle cost more than another even if they are the same make and model, said Worters. For example, a Honda Civic Si, the high-performance version of that car, might cost more to insure than the Honda Civic Hybrid.
Some vehicles are also more prone to having parts stolen, such as headlights or spoilers, Worters said.
Before deciding on a car to purchase, Worters recommends that shoppers contact their insurance agent with a list of the vehicles being considered.
Top 20 most popular cars ranked by relative cost to insure
Least expensive vehicle to insure is listed first.
1. Chrysler Town & Country
2. Chevrolet Cobalt
3. Dodge Caravan
4. Chevrolet Impala
5. Ford Taurus
6. Ford Econoline van
7. Jeep Grand Cherokee
8. Chevrolet Malibu
9. GMC Sierra pick-up
10. Toyota Corolla
11. Ford Focus
12. Nissan Altima
13. Chevrolet Trailblazer
14.Honda Accord
15. Toyota Camry
16. Chevrolet Silverado pick-up
17. Honda Civic
18. Ford Explorer
19. Dodge Ram pickup
20. Ford F-series pick-up
The Ford F-series pick-up, which consistently ranks as America's most popular vehicle, is also the most expensive to insure among the top 20, according to a report released today by the insurance website Insure.com.
The Chrysler Town & Country minivan is the least expensive to insure of the 20 most popular vehicles, while its corporate twin, the Dodge Caravan, is the third least expensive. The Chevrolet Cobalt small car is the second least expensive to insure, according to the report.
Any individual's actual car insurance premiums can vary greatly depending on factors such as their age, driving record and where they live. But the vehicle itself is a major factor that insurance companies consider to determine premiums.
Insurance is the third largest cost of owning a new car, after depreciation and fuel, according to Insure.com. Insurance premium costs, now averaging almost $900 per year, have risen 27 percent since 2000, according to the report.
Insure.com looked only at the 20 top-selling vehicles in the United States.
In order to rank the vehicles by their relative costs to insure, Insure.com compared rates provided by the website Esurance.com for a 45-year-old single male with no traffic violations who drives less than three miles to work. The amounts of coverage were also the same for each vehicle. Premiums for three different cities, one on the East Coast, one on the West Coast and one in the Midwest, were averaged for each vehicle.
Factors such as popularity with car thieves, how much the vehicle costs to repair after a crash and the amount of damage it does to another vehicle in a crash can influence a vehicles cost to insure, said Loretta Worters, vice president of the Insurance Information Institute.
Options, such as a bigger engine or a high-performance trim level, can make one vehicle cost more than another even if they are the same make and model, said Worters. For example, a Honda Civic Si, the high-performance version of that car, might cost more to insure than the Honda Civic Hybrid.
Some vehicles are also more prone to having parts stolen, such as headlights or spoilers, Worters said.
Before deciding on a car to purchase, Worters recommends that shoppers contact their insurance agent with a list of the vehicles being considered.
Top 20 most popular cars ranked by relative cost to insure
Least expensive vehicle to insure is listed first.
1. Chrysler Town & Country
2. Chevrolet Cobalt
3. Dodge Caravan
4. Chevrolet Impala
5. Ford Taurus
6. Ford Econoline van
7. Jeep Grand Cherokee
8. Chevrolet Malibu
9. GMC Sierra pick-up
10. Toyota Corolla
11. Ford Focus
12. Nissan Altima
13. Chevrolet Trailblazer
14.Honda Accord
15. Toyota Camry
16. Chevrolet Silverado pick-up
17. Honda Civic
18. Ford Explorer
19. Dodge Ram pickup
20. Ford F-series pick-up
Basing car insurance on profession
Allstate Insurance examined 10 million car insurance policies over a three-year period and examined accident claims according to profession. The results suggest people in certain jobs are less likely to have car accidents. As a result of the study, Allstate classified three levels of drivers.
Level three drivers receive a five per cent discount. They include: accountants, carpenters, elevator operators and telephone repairmen. Level two drivers receive a 10 per cent discount. They include: biologists, chemists, economists, judges and veterinarians. Level one is designated for Allstate employees, who also get a 10 per cent discount. The company says that doesn't mean they're less likely to have an accident than level two drivers.
Allstate officials say they did the study because they are always searching for ways to reward customers with safe driving records.
Level three drivers receive a five per cent discount. They include: accountants, carpenters, elevator operators and telephone repairmen. Level two drivers receive a 10 per cent discount. They include: biologists, chemists, economists, judges and veterinarians. Level one is designated for Allstate employees, who also get a 10 per cent discount. The company says that doesn't mean they're less likely to have an accident than level two drivers.
Allstate officials say they did the study because they are always searching for ways to reward customers with safe driving records.
Thursday, March 23, 2006
Congress debates health insurance
Tom Walker/Washington Bureau Chief
Washington D.C., March 22 - The people who run one small business selling and fixing lawn care equipment know well what it's like to have a problem they can't fix, how to provide health insurance for the ten people, including themselves, who work there.
They say it's almost to the point that they can't.
Co-owner Tom Stokes says, "It just seems your renewal time comes very quickly, fifteen to twenty to thirty percent increases on an annual basis."
One proposed solution would make it easier for small companies to get insurance at a better rate by linking up with other small businesses through trade associations.
But the plan is coming under fire on Capitol Hill because it would also allow those plans to bypass requirements of many states, including Indiana, for certain types of health coverage.
The result, say critics, is a lot of junk policies that may cost less, but also offer very little coverage.
Dana Christensen went to Washington to tell of the coverage she and her husband thought they had through an association plan when he was dying of bone cancer. They were stunned to find out the truth. "My husband had to go in for surgery and when we were being admitted into the hospital they told us our insurance policy was so poor that we had to pay $8,000 just to be admitted into the hospital."
She was left with half a million dollars in medical bills insurance wouldn't pay.
But horror stories like that have not convinced lawmakers the idea is a bad one.
Senator Mike Dewine (R - Ohio) believes, "Some insurance is better than no insurance for people, even if it is not
a Cadillac version of insurance."
That's the way state insurance regulators in Indiana are inclined to look at it too, for now. They are not nearly as concerned about this plan as officials in other states.
Health plans in Indiana are required to cover 33 different types of procedures. Officials say treatments for obesity and autism are two that might have to be dropped under the bill in Congress.
Washington D.C., March 22 - The people who run one small business selling and fixing lawn care equipment know well what it's like to have a problem they can't fix, how to provide health insurance for the ten people, including themselves, who work there.
They say it's almost to the point that they can't.
Co-owner Tom Stokes says, "It just seems your renewal time comes very quickly, fifteen to twenty to thirty percent increases on an annual basis."
One proposed solution would make it easier for small companies to get insurance at a better rate by linking up with other small businesses through trade associations.
But the plan is coming under fire on Capitol Hill because it would also allow those plans to bypass requirements of many states, including Indiana, for certain types of health coverage.
The result, say critics, is a lot of junk policies that may cost less, but also offer very little coverage.
Dana Christensen went to Washington to tell of the coverage she and her husband thought they had through an association plan when he was dying of bone cancer. They were stunned to find out the truth. "My husband had to go in for surgery and when we were being admitted into the hospital they told us our insurance policy was so poor that we had to pay $8,000 just to be admitted into the hospital."
She was left with half a million dollars in medical bills insurance wouldn't pay.
But horror stories like that have not convinced lawmakers the idea is a bad one.
Senator Mike Dewine (R - Ohio) believes, "Some insurance is better than no insurance for people, even if it is not
a Cadillac version of insurance."
That's the way state insurance regulators in Indiana are inclined to look at it too, for now. They are not nearly as concerned about this plan as officials in other states.
Health plans in Indiana are required to cover 33 different types of procedures. Officials say treatments for obesity and autism are two that might have to be dropped under the bill in Congress.
Wednesday, March 22, 2006
Premium car insurance not worth the extra cost
How good a deal is premium car insurance?
You may have seen TV commercials for Allstate's new extras, such as ``accident forgiveness,'' which keeps your rates from being raised after a crash, and for new car replacement.
Drivers pay as much as 15 percent more for accident foregiveness.
The new car replacement add-on costs another 2 percent and is intended to cover drivers for the rapid depreciation of a new car. If your car is totaled within three years of its purchase, Allstate will buy you a new one, rather than pay you the depreciated value.
You may already be getting some of those features for free.
It's true that insurers often raise your rates after a crash. But Nationwide forgives a single accident and multiple minor ones after three years of safe driving and it doesn't cost you a penny more.
As for new car replacement, the chances that your shiny new car will be totaled as you drive it off the lot are slim.
You may have seen TV commercials for Allstate's new extras, such as ``accident forgiveness,'' which keeps your rates from being raised after a crash, and for new car replacement.
Drivers pay as much as 15 percent more for accident foregiveness.
The new car replacement add-on costs another 2 percent and is intended to cover drivers for the rapid depreciation of a new car. If your car is totaled within three years of its purchase, Allstate will buy you a new one, rather than pay you the depreciated value.
You may already be getting some of those features for free.
It's true that insurers often raise your rates after a crash. But Nationwide forgives a single accident and multiple minor ones after three years of safe driving and it doesn't cost you a penny more.
As for new car replacement, the chances that your shiny new car will be totaled as you drive it off the lot are slim.
UF's expanded health insurance for students covers morning-after pill
By JACK STRIPLING
Sun staff writer
March 22. 2006 6:01AM
More birth control options, including a controversial morning-after pill called Plan B, are now covered by the University of Florida's student health insurance plan.
Changes in the health care plan, which went into effect Thursday, came at the behest of UF's Pharmacy Committee, an organization within the Student Health Center.
Laura Tipton, pharmacy manager, said the committee felt it was "biased or unfair" that oral contraception was covered by the plan while other forms were not. In addition to Plan B, the coverage now extends to the NuvaRing, the Ortho Evra birth control patch and the Depo-Provera Shot.
"They are very pleased," Tipton said of the students.
Some abortion opponents have criticized Plan B, arguing that it can be a form of abortion when it blocks the implantation of a fertilized egg. Tipton said criticism of the morning-after pill was never discussed as the committee negotiated an extension of the plan.
The Student Health Center offered Plan B before insurance coverage changed, and Tipton said she did not think use would increase due to the change. Plan B is a viable option for anyone who has had unprotected sex or has been sexually assaulted, she said.
"There are times when we dispense a lot of it," she said. "There's no doubt about it."
The student health care plan is provided by Nationwide Mutual Insurance Co. and administered locally by Scarborough Insurance. About 5,500 students are covered by the plan.
Students bear the cost of coverage, except for graduate teaching assistants who receive a $500 annual subsidy from UF, a Scarborough official said.
Jack Stripling can be reached at 374-5064 or Jack.Stripling@gvillesun.com
Birth control options expand at UF
The University of Florida's student health care coverage has been expanded to include the following forms of birth control:
The Patch (Ortho Evra): A patch worn for three weeks each month that releases the hormones progestin and estrogen to prevent pregnancy. It is 98 to 99 percent effective.
n Depo-Provera Shot: A shot of the hormone progestin injected every three months to prevent pregnancy. It is 97 percent effective.
n NuvaRing: A flexible vaginal ring, about the size of a silver dollar, that delivers the hormones progestin and estrogen to prevent pregnancy. It is 98 to 99 percent effective.
Plan B (Morning-after pill): Two doses of hormonal pills taken as emergency contraception within three days after having unprotected sex. It is 75 to 89 percent effective.
Sun staff writer
March 22. 2006 6:01AM
More birth control options, including a controversial morning-after pill called Plan B, are now covered by the University of Florida's student health insurance plan.
Changes in the health care plan, which went into effect Thursday, came at the behest of UF's Pharmacy Committee, an organization within the Student Health Center.
Laura Tipton, pharmacy manager, said the committee felt it was "biased or unfair" that oral contraception was covered by the plan while other forms were not. In addition to Plan B, the coverage now extends to the NuvaRing, the Ortho Evra birth control patch and the Depo-Provera Shot.
"They are very pleased," Tipton said of the students.
Some abortion opponents have criticized Plan B, arguing that it can be a form of abortion when it blocks the implantation of a fertilized egg. Tipton said criticism of the morning-after pill was never discussed as the committee negotiated an extension of the plan.
The Student Health Center offered Plan B before insurance coverage changed, and Tipton said she did not think use would increase due to the change. Plan B is a viable option for anyone who has had unprotected sex or has been sexually assaulted, she said.
"There are times when we dispense a lot of it," she said. "There's no doubt about it."
The student health care plan is provided by Nationwide Mutual Insurance Co. and administered locally by Scarborough Insurance. About 5,500 students are covered by the plan.
Students bear the cost of coverage, except for graduate teaching assistants who receive a $500 annual subsidy from UF, a Scarborough official said.
Jack Stripling can be reached at 374-5064 or Jack.Stripling@gvillesun.com
Birth control options expand at UF
The University of Florida's student health care coverage has been expanded to include the following forms of birth control:
The Patch (Ortho Evra): A patch worn for three weeks each month that releases the hormones progestin and estrogen to prevent pregnancy. It is 98 to 99 percent effective.
n Depo-Provera Shot: A shot of the hormone progestin injected every three months to prevent pregnancy. It is 97 percent effective.
n NuvaRing: A flexible vaginal ring, about the size of a silver dollar, that delivers the hormones progestin and estrogen to prevent pregnancy. It is 98 to 99 percent effective.
Plan B (Morning-after pill): Two doses of hormonal pills taken as emergency contraception within three days after having unprotected sex. It is 75 to 89 percent effective.
Tuesday, March 21, 2006
Health Savings Accounts (HSAs)
Critics of Health Savings Accounts (HSAs) have a litany of complaints. They are essentially the same complaints critics made a decade ago, at the dawn of the consumer-driven health care revolution. We now have evidence that consumer-driven health care works. In addition to the decade of experience with Medical Savings Accounts (MSAs) in South Africa, Americans have had six years' experience with an MSA pilot program, four years with similar accounts called Health Reimbursement Arrangements (HRAs) and two years with HSAs themselves, say John C. Goodman, president of, and Devon Herrick, a senior fellow with, the National Center for Policy Analysis.
What follows are answers to some of the most important criticisms.
Criticism: HSAs primarily benefit the healthy.
Reply: People with significant health problems benefit from HSA plans because they have a maximum out-of-pocket expenditure, whereas traditional health plans have no such limit. That is why out-of-pocket spending for such patients often goes down when they switch to HSA plans.
Criticism: HSAs won't help reduce the number of uninsured.
Reply: HSAs have already reduced the number of uninsured Americans. America's Health Insurance Plans, a trade group for health insurers, reports that about one-third of people who individually purchased HSA plans were previously uninsured. This is consistent with reports from Assurant and eHealthInsurance, which found that about half of those with incomes under $35,000 had not had coverage for at least six months prior to enrollment.
Criticism: Consumers don't like HSAs.
Reply: HSAs are spreading rapidly. A survey by America's Health Insurance Plans finds that about 3.2 million people are enrolled in HSA plans and another 3 million have HRAs. A U.S. Treasury estimate projects 14 million HSA accounts by 2010 and 21 million if President Bush's recent proposals are adopted.
Source: John C. Goodman and Devon M. Herrick, "Health Savings Accounts: Answering the Critics, Part I, II, III," National Center for Policy Analysis, March 21, 2006.
What follows are answers to some of the most important criticisms.
Criticism: HSAs primarily benefit the healthy.
Reply: People with significant health problems benefit from HSA plans because they have a maximum out-of-pocket expenditure, whereas traditional health plans have no such limit. That is why out-of-pocket spending for such patients often goes down when they switch to HSA plans.
Criticism: HSAs won't help reduce the number of uninsured.
Reply: HSAs have already reduced the number of uninsured Americans. America's Health Insurance Plans, a trade group for health insurers, reports that about one-third of people who individually purchased HSA plans were previously uninsured. This is consistent with reports from Assurant and eHealthInsurance, which found that about half of those with incomes under $35,000 had not had coverage for at least six months prior to enrollment.
Criticism: Consumers don't like HSAs.
Reply: HSAs are spreading rapidly. A survey by America's Health Insurance Plans finds that about 3.2 million people are enrolled in HSA plans and another 3 million have HRAs. A U.S. Treasury estimate projects 14 million HSA accounts by 2010 and 21 million if President Bush's recent proposals are adopted.
Source: John C. Goodman and Devon M. Herrick, "Health Savings Accounts: Answering the Critics, Part I, II, III," National Center for Policy Analysis, March 21, 2006.
Labor unions rally for health insurance
By Bill Cotterell
DEMOCRAT POLITICAL EDITOR
Demonstrators from labor unions heckled the powerful president of Florida's biggest business organization Monday at a Capitol rally, which was held to support a plan to make employers provide health-care insurance or contribute to a state fund for covering the working poor.
Rep. Susan Bucher, D-West Palm Beach, said making companies provide employee health insurance would not wipe out jobs. Sen. Tony Hill, D-Jacksonville, said organized labor and civil-rights groups will take vengeance at the polls in November if the Republican-run Legislature fails to bring the "fair share health care act" to a vote during the 2006 session.
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"We know that we have responsible corporate entities and then we have some irresponsible ones," Bucher told about 150 sign-waving pickets in the Capitol courtyard. "It's time that we level the business playing field and make this requirement a law."
Bucher and Sen. Walter "Skip" Campbell, D-Fort Lauderdale, sponsored bills (HB 813 and SB 1618) that would require companies with more than 10,000 employees in Florida to devote 9 percent of their payroll costs to health care. If a company had no insurance plan, or spent less than 9 percent of payroll on it, the firm would have to pay the difference into a state fund that would cover costs of Medicaid and other health programs for the poor.
Corporate change
Bucher said there are 23 companies in Florida - including Wal-Mart, Publix, Walgreen's, Burger King, McDonald's and Winn-Dixie - that would be affected by the requirement.
Barney Bishop, president of Associated Industries of Florida, smiled and waved from the back of the crowd when he and some other business lobbyists were pointed out by Jeanette Wynn, president of the American Federation of State, County and Municipal Employees. Demonstrators chanted "corporate welfare has got to go" and shook their picket signs at Bishop.
"It's a policy that sounds fantastic but when you drill down deeper into this issue, what you're going to realize is that most companies in Florida and in America already provide health insurance," said Bishop. He said most Wal-Mart employees, for instance, are older or younger workers who have other coverage - and that the retailer offers some health plans for its employees.
"This is a deal killer," Bishop said. "This is going to hurt Florida's economy. Mandates never improve the economy, but incentives always work."
Linda Chavez-Thompson, executive vice president of the national AFL-CIO, said Florida gives millions in tax breaks and other financial incentives for big businesses establishing stores or plants in the state. She said the state allows some businesses to hold down operating costs by passing their employee health-care costs on to the taxpayers.
Election-year issue
Hill said that even if the Bucher-Campbell bill never gets out of committee, the labor movement will use it as an issue in this election year.
"It's time for us to move in the same direction as Maryland," he said. "Sometimes, by just raising the issue, we can win. In November, we're going to retire some of these folks."
DEMOCRAT POLITICAL EDITOR
Demonstrators from labor unions heckled the powerful president of Florida's biggest business organization Monday at a Capitol rally, which was held to support a plan to make employers provide health-care insurance or contribute to a state fund for covering the working poor.
Rep. Susan Bucher, D-West Palm Beach, said making companies provide employee health insurance would not wipe out jobs. Sen. Tony Hill, D-Jacksonville, said organized labor and civil-rights groups will take vengeance at the polls in November if the Republican-run Legislature fails to bring the "fair share health care act" to a vote during the 2006 session.
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"We know that we have responsible corporate entities and then we have some irresponsible ones," Bucher told about 150 sign-waving pickets in the Capitol courtyard. "It's time that we level the business playing field and make this requirement a law."
Bucher and Sen. Walter "Skip" Campbell, D-Fort Lauderdale, sponsored bills (HB 813 and SB 1618) that would require companies with more than 10,000 employees in Florida to devote 9 percent of their payroll costs to health care. If a company had no insurance plan, or spent less than 9 percent of payroll on it, the firm would have to pay the difference into a state fund that would cover costs of Medicaid and other health programs for the poor.
Corporate change
Bucher said there are 23 companies in Florida - including Wal-Mart, Publix, Walgreen's, Burger King, McDonald's and Winn-Dixie - that would be affected by the requirement.
Barney Bishop, president of Associated Industries of Florida, smiled and waved from the back of the crowd when he and some other business lobbyists were pointed out by Jeanette Wynn, president of the American Federation of State, County and Municipal Employees. Demonstrators chanted "corporate welfare has got to go" and shook their picket signs at Bishop.
"It's a policy that sounds fantastic but when you drill down deeper into this issue, what you're going to realize is that most companies in Florida and in America already provide health insurance," said Bishop. He said most Wal-Mart employees, for instance, are older or younger workers who have other coverage - and that the retailer offers some health plans for its employees.
"This is a deal killer," Bishop said. "This is going to hurt Florida's economy. Mandates never improve the economy, but incentives always work."
Linda Chavez-Thompson, executive vice president of the national AFL-CIO, said Florida gives millions in tax breaks and other financial incentives for big businesses establishing stores or plants in the state. She said the state allows some businesses to hold down operating costs by passing their employee health-care costs on to the taxpayers.
Election-year issue
Hill said that even if the Bucher-Campbell bill never gets out of committee, the labor movement will use it as an issue in this election year.
"It's time for us to move in the same direction as Maryland," he said. "Sometimes, by just raising the issue, we can win. In November, we're going to retire some of these folks."
GEICO charged with unfair auto insurance rates
from Reuters
By Jonathan Stempel
NEW YORK, March 20 (Reuters) - A leading U.S. consumer group on Monday accused Geico Corp. of using consumers' education backgrounds and occupations as criteria in setting auto insurance rates, resulting in discrimination against minorities and lower-income people.
The Consumer Federation of America (CFA) charged that the No. 4 U.S. auto insurer, has adopted rating methods and underwriting guidelines in 44 states that directly tie rates to education and occupation.
Geico, a unit of Berkshire Hathaway Inc. (BRKa.N: Quote, Profile, Research) (BRKb.N: Quote, Profile, Research), the insurance and investment company controlled by billionaire Warren Buffett, rejected the charges. It called them "an offensive attempt to link fundamentally fair and actuarially sound industry practices with invidious discrimination."
The insurer provides auto insurance to more than 6 million policyholders, and insures more than 10 million vehicles.
Robert Hunter, the CFA's director of insurance and a former Texas insurance commissioner, called Geico's rate-setting policies an "underwriting sleight-of-hand" that can shortchange thousands of drivers.
Under Geico's guidelines, he said, a New Orleans factory worker without a high school education would pay $2,636 for insurance, 91 percent more the $1,382 that a white-collar worker with a graduate degree would pay for the same vehicle and location.
"There is clearly a disparate impact on minorities and lower income people," Hunter said in an interview. "If it isn't violative of the law, it should be. It strikes me as very unfair."
In a March 14 letter to the National Association of Insurance Commissioners, the CFA said Geico's use of educational status alone to determine rates allows it to bypass prohibitions on using income as a guideline for setting rates, on the grounds that doing so is racially discriminatory.
"What is very troubling is that Geico appears to be using these guidelines as a de facto rating method," it said. "Geico's methodology is reprehensible because not everyone has the opportunity or can afford to pursue a four-year college degree."
The CFA asked the NAIC to intervene before the practice, which it said other auto insurers are beginning to use, becomes more widespread.
Geico, responding in a March 17 letter to the NAIC, said the CFA's opinions are wrong from a public policy and legal perspective, and constitute a "full frontal attack" on market competition and consumer choice.
By Jonathan Stempel
NEW YORK, March 20 (Reuters) - A leading U.S. consumer group on Monday accused Geico Corp. of using consumers' education backgrounds and occupations as criteria in setting auto insurance rates, resulting in discrimination against minorities and lower-income people.
The Consumer Federation of America (CFA) charged that the No. 4 U.S. auto insurer, has adopted rating methods and underwriting guidelines in 44 states that directly tie rates to education and occupation.
Geico, a unit of Berkshire Hathaway Inc. (BRKa.N: Quote, Profile, Research) (BRKb.N: Quote, Profile, Research), the insurance and investment company controlled by billionaire Warren Buffett, rejected the charges. It called them "an offensive attempt to link fundamentally fair and actuarially sound industry practices with invidious discrimination."
The insurer provides auto insurance to more than 6 million policyholders, and insures more than 10 million vehicles.
Robert Hunter, the CFA's director of insurance and a former Texas insurance commissioner, called Geico's rate-setting policies an "underwriting sleight-of-hand" that can shortchange thousands of drivers.
Under Geico's guidelines, he said, a New Orleans factory worker without a high school education would pay $2,636 for insurance, 91 percent more the $1,382 that a white-collar worker with a graduate degree would pay for the same vehicle and location.
"There is clearly a disparate impact on minorities and lower income people," Hunter said in an interview. "If it isn't violative of the law, it should be. It strikes me as very unfair."
In a March 14 letter to the National Association of Insurance Commissioners, the CFA said Geico's use of educational status alone to determine rates allows it to bypass prohibitions on using income as a guideline for setting rates, on the grounds that doing so is racially discriminatory.
"What is very troubling is that Geico appears to be using these guidelines as a de facto rating method," it said. "Geico's methodology is reprehensible because not everyone has the opportunity or can afford to pursue a four-year college degree."
The CFA asked the NAIC to intervene before the practice, which it said other auto insurers are beginning to use, becomes more widespread.
Geico, responding in a March 17 letter to the NAIC, said the CFA's opinions are wrong from a public policy and legal perspective, and constitute a "full frontal attack" on market competition and consumer choice.
Monday, March 20, 2006
Highmark buy may change insurance landscape
from Post Gazette
By Christopher Snowbeck, Pittsburgh Post-Gazette
Highmark Inc. spent $16 million last year to buy a Virginia company that it could use to sell health plans in Pennsylvania, a move that could prove significant in the local insurance market for small businesses.
The purchase enables the region's dominant health insurer to create a for-profit subsidiary that could compete in the "small group" market, where Highmark has been trying to convince the state Legislature to change the rules governing how companies set premiums. With a for-profit subsidiary, Highmark could, in effect, adopt the business practices of the for-profit competitors it has been trying to abolish in the small business marketplace. A "small group" in Pennsylvania is one that includes two to 50 people.
The new subsidiary -- called HM Health Insurance Company -- could be used in other ways, as well. HM Health has licenses to underwrite coverage in 46 states and Washington, D.C., and multi-state licenses could prove useful to Highmark if proposed federal legislation allows for interstate sales of health insurance to small business groups, said Cliff Shannon of SMC Business Councils in Churchill.
Highmark spokesman Michael Weinstein said the company is evaluating its options for the subsidiary.
Purchased in August from WellPoint Inc., a publicly-traded company based in Indianapolis that is an amalgamation of numerous Blue Cross plans, the company acquired by Highmark was basically a shell with licenses and financial assets but no employees and subscribers. The acquisition was noted by Highmark in financial documents released last week by the state Department of Insurance.
"The idea when we bought it was -- and we're still pursuing this -- the concern that there's this two-tiered regulatory framework for small employer health insurance," Mr. Weinstein said.
Highmark has argued for more than a year that legislative changes are needed so it can compete on a more equal basis with Aetna, HealthAmerica and other companies that price insurance policies based on the health status of employees. Because of their position as insurers of last resort in Pennsylvania, Blue Cross insurers don't collect this detailed information, also called "medical underwriting."
Competitors that consider health status when setting rates essentially "cherry pick," Highmark says, by offering affordable coverage to only low-risk groups. That leaves high-risk groups, which typically have large numbers of women or older men, with Blue Cross plans.
The acquisition, however, suggests that Highmark is positioning itself so that it can pursue an "if-you-can't-beat-em-join-em" strategy.
"I do think that it provides a certain amount of leverage in their discussions with the state legislature and regulators about the topic of small group reform," said Doug Moore, an insurance broker with Seubert & Associates in Bellevue.
"I do think the regulators, in particular, consider the turmoil in the market if Highmark shifted [the small-group business] to a for-profit carrier."
Critics of Highmark-backed reform bills argue that eliminating medical underwriting would effectively kill health insurance competition in the state.
Without the ability to consider health status in setting insurance rates, premiums would be a function primarily of the discounts that insurers negotiate with doctors and hospitals -- and Blue Cross plans because of their market share always get the best rates, according to supporters of medical underwriting.
Eliminating medical underwriting would have the effect of driving non-Blue Cross insurers from the state, critics say. They add that medical underwriting allows insurance companies to financially reward groups that have fewer risk factors, some of which can be controlled by personal behavior.
Although four bills addressing the issue were considered by the General Assembly last year, the debate didn't generate any results. Considering the importance of the small group business to Highmark -- it generates about $900 million in annual revenue -- the company felt the need to consider options other than legislation.
"One of the options that we were looking at was the use of this subsidiary as a means to market insurance to smaller employers," said Mr. Weinstein, the Highmark spokesman. "Why would we do that? We would not have to be subject to the same types of regulatory constraints if [small group] products were sold through this distribution channel."
While the debate continues at the state level, developments at the federal level could provide a different use for the subsidiary, said Mr. Shannon. A bill currently being considered would allow for the creation of health plans for small groups that cross state lines.
"Apart from facilitating interstate sales of small group health insurance, [the federal legislation] would lead to a further consolidation in the health insurer industry," Mr. Shannon said. "The ability to operate in a lot of states would become very important."
By Christopher Snowbeck, Pittsburgh Post-Gazette
Highmark Inc. spent $16 million last year to buy a Virginia company that it could use to sell health plans in Pennsylvania, a move that could prove significant in the local insurance market for small businesses.
The purchase enables the region's dominant health insurer to create a for-profit subsidiary that could compete in the "small group" market, where Highmark has been trying to convince the state Legislature to change the rules governing how companies set premiums. With a for-profit subsidiary, Highmark could, in effect, adopt the business practices of the for-profit competitors it has been trying to abolish in the small business marketplace. A "small group" in Pennsylvania is one that includes two to 50 people.
The new subsidiary -- called HM Health Insurance Company -- could be used in other ways, as well. HM Health has licenses to underwrite coverage in 46 states and Washington, D.C., and multi-state licenses could prove useful to Highmark if proposed federal legislation allows for interstate sales of health insurance to small business groups, said Cliff Shannon of SMC Business Councils in Churchill.
Highmark spokesman Michael Weinstein said the company is evaluating its options for the subsidiary.
Purchased in August from WellPoint Inc., a publicly-traded company based in Indianapolis that is an amalgamation of numerous Blue Cross plans, the company acquired by Highmark was basically a shell with licenses and financial assets but no employees and subscribers. The acquisition was noted by Highmark in financial documents released last week by the state Department of Insurance.
"The idea when we bought it was -- and we're still pursuing this -- the concern that there's this two-tiered regulatory framework for small employer health insurance," Mr. Weinstein said.
Highmark has argued for more than a year that legislative changes are needed so it can compete on a more equal basis with Aetna, HealthAmerica and other companies that price insurance policies based on the health status of employees. Because of their position as insurers of last resort in Pennsylvania, Blue Cross insurers don't collect this detailed information, also called "medical underwriting."
Competitors that consider health status when setting rates essentially "cherry pick," Highmark says, by offering affordable coverage to only low-risk groups. That leaves high-risk groups, which typically have large numbers of women or older men, with Blue Cross plans.
The acquisition, however, suggests that Highmark is positioning itself so that it can pursue an "if-you-can't-beat-em-join-em" strategy.
"I do think that it provides a certain amount of leverage in their discussions with the state legislature and regulators about the topic of small group reform," said Doug Moore, an insurance broker with Seubert & Associates in Bellevue.
"I do think the regulators, in particular, consider the turmoil in the market if Highmark shifted [the small-group business] to a for-profit carrier."
Critics of Highmark-backed reform bills argue that eliminating medical underwriting would effectively kill health insurance competition in the state.
Without the ability to consider health status in setting insurance rates, premiums would be a function primarily of the discounts that insurers negotiate with doctors and hospitals -- and Blue Cross plans because of their market share always get the best rates, according to supporters of medical underwriting.
Eliminating medical underwriting would have the effect of driving non-Blue Cross insurers from the state, critics say. They add that medical underwriting allows insurance companies to financially reward groups that have fewer risk factors, some of which can be controlled by personal behavior.
Although four bills addressing the issue were considered by the General Assembly last year, the debate didn't generate any results. Considering the importance of the small group business to Highmark -- it generates about $900 million in annual revenue -- the company felt the need to consider options other than legislation.
"One of the options that we were looking at was the use of this subsidiary as a means to market insurance to smaller employers," said Mr. Weinstein, the Highmark spokesman. "Why would we do that? We would not have to be subject to the same types of regulatory constraints if [small group] products were sold through this distribution channel."
While the debate continues at the state level, developments at the federal level could provide a different use for the subsidiary, said Mr. Shannon. A bill currently being considered would allow for the creation of health plans for small groups that cross state lines.
"Apart from facilitating interstate sales of small group health insurance, [the federal legislation] would lead to a further consolidation in the health insurer industry," Mr. Shannon said. "The ability to operate in a lot of states would become very important."
Non Owner Auto Insurance Coverage Available in Florida from Serenity Insurance Group
Press release
Spokane, WA (PRWEB) March 20, 2006 -- Serenity Insurance Group, a long time provider of SR22 Automobile insurance, now offers non owner auto insurance coverage in Florida. Non-owner insurance policies provide liability insurance coverage to individuals who don't own vehicles.
High risk drivers who have had their driver's license revoked or suspended in the past may also need this type of insurance coverage if they don't own a vehicle and want to retain their driver’s licenses. Motor vehicle departments will not reinstate a driver's license without proof of minimum liability insurance.
A non owner auto insurance policy may also include uninsured motorist coverage, and personal injury protection.
An added benefit to Non Owner Insurance is to show proof of continuous coverage. In situations where a vehicle is sold and not replaced, most people cancel or let their existing insurance policies lapse or expire. If there is a lapse in insurance coverage for an extended period of time, it may be more expensive to get coverage when you buy your next car. Most insurance companies look for continuous coverage when rating an individual for a new auto insurance policy and Serenity Insurance offers non owner vehicle insurance as the perfect solution. Call Serenity Insurance today toll free: 1-800-774-0520 or visit their website for details: www.serenitygroup.com/.
Situations can occur unexpectedly when driving a borrowed vehicle. Don’t be caught without adequate insurance coverage. If you have an accident in a borrowed car, your non owner insurance coverage will protect you for liability coverage. The vehicle owner's liability insurance usually pays first and if damages exceed the limits of the vehicle owner's policy, your non owner coverage will be utilized.
Since a non owner policy may be less expensive than vehicle owner insurance coverage, it makes sense to choose this protection.
Spokane, WA (PRWEB) March 20, 2006 -- Serenity Insurance Group, a long time provider of SR22 Automobile insurance, now offers non owner auto insurance coverage in Florida. Non-owner insurance policies provide liability insurance coverage to individuals who don't own vehicles.
High risk drivers who have had their driver's license revoked or suspended in the past may also need this type of insurance coverage if they don't own a vehicle and want to retain their driver’s licenses. Motor vehicle departments will not reinstate a driver's license without proof of minimum liability insurance.
A non owner auto insurance policy may also include uninsured motorist coverage, and personal injury protection.
An added benefit to Non Owner Insurance is to show proof of continuous coverage. In situations where a vehicle is sold and not replaced, most people cancel or let their existing insurance policies lapse or expire. If there is a lapse in insurance coverage for an extended period of time, it may be more expensive to get coverage when you buy your next car. Most insurance companies look for continuous coverage when rating an individual for a new auto insurance policy and Serenity Insurance offers non owner vehicle insurance as the perfect solution. Call Serenity Insurance today toll free: 1-800-774-0520 or visit their website for details: www.serenitygroup.com/.
Situations can occur unexpectedly when driving a borrowed vehicle. Don’t be caught without adequate insurance coverage. If you have an accident in a borrowed car, your non owner insurance coverage will protect you for liability coverage. The vehicle owner's liability insurance usually pays first and if damages exceed the limits of the vehicle owner's policy, your non owner coverage will be utilized.
Since a non owner policy may be less expensive than vehicle owner insurance coverage, it makes sense to choose this protection.
Friday, March 17, 2006
Senate approves health insurance plan for small businesses
WASHINGTON — The Senate Committee on Health, Education, Labor and Pensions approved legislation that would make health insurance more affordable and accessible for America's small businesses, including the 12.5 million employees of the restaurant industry.
On March 15, the HELP Committee passed S. 1955, the Health Insurance Marketplace Modernization and Affordability Act of 2005, by a vote of 11-9. According to a National Restaurant Association meeting, this legislation would allow small businesses to create fully insured Small-Business Health Plans (SBHPs) that would lower health-care costs and increase access by providing increased competition and choices for employers looking for affordable health coverage.
Approximately 45 million Americans are without health insurance, and studies show that 60 percent of the uninsured either work for a small business or are a dependent of someone who does. Unless dramatically increasing health care costs are curbed, many employers may be forced to eliminate health benefits for their employees.
The National Restaurant Association said that 70 percent of the restaurant industry - the largest private sector employer in the country — is comprised of small businesses and recent surveys show that restaurateurs are deeply affected by the rising cost of health insurance.
SBHPs would allow small business owners to join together across state lines to purchase health insurance as a group; providing affordable health care through economies of scale, greater bargaining power and flexibility in health benefit design. By removing barriers to affordable coverage, this legislation will also greatly increase competition in health insurance markets, with substantial benefits to consumers.
On March 15, the HELP Committee passed S. 1955, the Health Insurance Marketplace Modernization and Affordability Act of 2005, by a vote of 11-9. According to a National Restaurant Association meeting, this legislation would allow small businesses to create fully insured Small-Business Health Plans (SBHPs) that would lower health-care costs and increase access by providing increased competition and choices for employers looking for affordable health coverage.
Approximately 45 million Americans are without health insurance, and studies show that 60 percent of the uninsured either work for a small business or are a dependent of someone who does. Unless dramatically increasing health care costs are curbed, many employers may be forced to eliminate health benefits for their employees.
The National Restaurant Association said that 70 percent of the restaurant industry - the largest private sector employer in the country — is comprised of small businesses and recent surveys show that restaurateurs are deeply affected by the rising cost of health insurance.
SBHPs would allow small business owners to join together across state lines to purchase health insurance as a group; providing affordable health care through economies of scale, greater bargaining power and flexibility in health benefit design. By removing barriers to affordable coverage, this legislation will also greatly increase competition in health insurance markets, with substantial benefits to consumers.
Thursday, March 16, 2006
Smoking and the Cost of Your Health Insurance
Should federal employees who smoke pay more for their health insurance premiums?
Smoking and the cost of health insurance is a significant issue for employers. As any federal employee knows, the cost of health insurance for federal employees has been rising rapidly. Private companies that provide health insurance for employees are getting desperate for ways to cut back on their health insurance costs without eliminating their health insurance benefits.
Smokers in America today face more discrimination than ever. Here are a few examples of how our society has changed.
No longer do the major movie stars speak from the big silver screen looking sophisticated and charming while dangling a lit cigarette from their lips or hand.
Modern entertainers no longer croon to the audience while holding a lit cigarette to enhance their image with fans (think Frank Sinatra or Dean Martin)
Smokers don't live as long so they don't collect as much in the way of Social Security or retirement benefits.
As many as 6000 companies will no longer hire permanent, full-time employees who smoke.
Some companies are firing employees who smoke because of health costs, loss of productivity from health problems and social conflicts.
Federal conference rooms used to have large, clear brown ashtrays in the middle of the conference tables to accomodate smokers with ashtrays spread around the outside of the room to accomodate those attending the meeting but not sitting at the table.
The cost of buying cigarettes is going up cutting down on money a smoker has for other expenses. A typical smoker may pay as much as $1400 for a pack-a-day smoking habit
Those who smoke are often seen outside of office buildings where they must go to smoke--even in cold climates or in very hot climates
There is little doubt that the potential health costs for smokers are higher than for non-smokers. There is probably no exact figure on which everyone would agree about the cost of smoking-related health issues. As a rough guide, it is about $75 billion per year according to data from the Centers for Disease Control (CDC).
That is why some companies are charging smokers more money for their health insurance benefits. On the other hand, smoking is addictive. Some people who smoke would like to quit but have not been able to overcome the habit.
And, while there are various smoking cessation benefits available for federal employees who smoke, there is no financial penalty (at least as far as the cost of health insurance is concerned) when it comes to paying for health insurance through the Federal Employees Health Benefit program.
We would like to know your opinion. Should those participating in the federal health insurance plan pay more for health insurance than those who do not smoke?
Smoking and the cost of health insurance is a significant issue for employers. As any federal employee knows, the cost of health insurance for federal employees has been rising rapidly. Private companies that provide health insurance for employees are getting desperate for ways to cut back on their health insurance costs without eliminating their health insurance benefits.
Smokers in America today face more discrimination than ever. Here are a few examples of how our society has changed.
No longer do the major movie stars speak from the big silver screen looking sophisticated and charming while dangling a lit cigarette from their lips or hand.
Modern entertainers no longer croon to the audience while holding a lit cigarette to enhance their image with fans (think Frank Sinatra or Dean Martin)
Smokers don't live as long so they don't collect as much in the way of Social Security or retirement benefits.
As many as 6000 companies will no longer hire permanent, full-time employees who smoke.
Some companies are firing employees who smoke because of health costs, loss of productivity from health problems and social conflicts.
Federal conference rooms used to have large, clear brown ashtrays in the middle of the conference tables to accomodate smokers with ashtrays spread around the outside of the room to accomodate those attending the meeting but not sitting at the table.
The cost of buying cigarettes is going up cutting down on money a smoker has for other expenses. A typical smoker may pay as much as $1400 for a pack-a-day smoking habit
Those who smoke are often seen outside of office buildings where they must go to smoke--even in cold climates or in very hot climates
There is little doubt that the potential health costs for smokers are higher than for non-smokers. There is probably no exact figure on which everyone would agree about the cost of smoking-related health issues. As a rough guide, it is about $75 billion per year according to data from the Centers for Disease Control (CDC).
That is why some companies are charging smokers more money for their health insurance benefits. On the other hand, smoking is addictive. Some people who smoke would like to quit but have not been able to overcome the habit.
And, while there are various smoking cessation benefits available for federal employees who smoke, there is no financial penalty (at least as far as the cost of health insurance is concerned) when it comes to paying for health insurance through the Federal Employees Health Benefit program.
We would like to know your opinion. Should those participating in the federal health insurance plan pay more for health insurance than those who do not smoke?
State Sets June Hearing On NC Auto Insurance Rates
State Insurance Commissioner Jim Long has announced a hearing on North Carolina automobile insurance rates set for June.
This announcement comes after the North Carolina Rate Bureau, an independent organization that represents all auto insurance companies in the state, filed for a 6.7 percent increase in rates Feb. 1. However, the bureau recently has informed the department about a data error that will revise their initial request to a 7.6 percent overall increase.
Department officials reviewed the rate filing and determined that the requested increase was not justified. State law requires Long to serve as hearing officer during a hearing to decide the matter. Auto rate hearings typically encompass three to four weeks of testimony from both sides. However, the 2005 hearings lasted more than four months.
“This filing came on the heels of the 2005 settlement where Commissioner Long ordered an overall decrease in auto rates,” said Sherri Hubbard, the department’s lead rate attorney on this case. “So why now, only a month later, do North Carolinians need an increase after years of low rates from financially sound companies?”
Last month, Long ordered a 2.5 percent overall decrease in auto rates when the bureau requested a 9.6 percent increase. In 2004, the department negotiated a zero percent change in rates instead of the requested 12.3 percent increase.
Long will decide what rate change, if any, is warranted during the hearing. If the bureau wishes to appeal his decision, it can do so through the court system, and companies can raise rates while awaiting an appeals decision.
The difference in the ordered rate and the implemented rate must be held in escrow. If the Bureau loses its appeal, the escrowed money must be refunded to policyholders who paid too much.
In 2004, the resolution of two such appealed cases resulted in an auto rate refund worth several hundred million dollars. In October and November 2004, North Carolina drivers received refund checks, often for hundreds of dollars. The two cases were from 2001 and 2002.
The 2001 case was decided in North Carolina Supreme Court, which ruled in Long’s favor. The 2002 case was settled out of court quickly after that.
This announcement comes after the North Carolina Rate Bureau, an independent organization that represents all auto insurance companies in the state, filed for a 6.7 percent increase in rates Feb. 1. However, the bureau recently has informed the department about a data error that will revise their initial request to a 7.6 percent overall increase.
Department officials reviewed the rate filing and determined that the requested increase was not justified. State law requires Long to serve as hearing officer during a hearing to decide the matter. Auto rate hearings typically encompass three to four weeks of testimony from both sides. However, the 2005 hearings lasted more than four months.
“This filing came on the heels of the 2005 settlement where Commissioner Long ordered an overall decrease in auto rates,” said Sherri Hubbard, the department’s lead rate attorney on this case. “So why now, only a month later, do North Carolinians need an increase after years of low rates from financially sound companies?”
Last month, Long ordered a 2.5 percent overall decrease in auto rates when the bureau requested a 9.6 percent increase. In 2004, the department negotiated a zero percent change in rates instead of the requested 12.3 percent increase.
Long will decide what rate change, if any, is warranted during the hearing. If the bureau wishes to appeal his decision, it can do so through the court system, and companies can raise rates while awaiting an appeals decision.
The difference in the ordered rate and the implemented rate must be held in escrow. If the Bureau loses its appeal, the escrowed money must be refunded to policyholders who paid too much.
In 2004, the resolution of two such appealed cases resulted in an auto rate refund worth several hundred million dollars. In October and November 2004, North Carolina drivers received refund checks, often for hundreds of dollars. The two cases were from 2001 and 2002.
The 2001 case was decided in North Carolina Supreme Court, which ruled in Long’s favor. The 2002 case was settled out of court quickly after that.
Wednesday, March 15, 2006
Cross-border health insurance plan targets Hispanic immigrants
PETER PRENGAMANAssociated PressLOS ANGELES - Hispanic immigrants can see a doctor here or in Mexico under a handful of cross-border insurance plans being launched this week by Health Net of California.
The plans, believed to be the first of their kind in California, are open to people living in Los Angeles, Ventura and Orange counties, said Ana Andrade, vice president of Latino programs for Health Net of California.
Coverage areas include Mexican border cities of Tijuana, Tecate and Mexicali, with Mexican health care provider Sistemas Medicos Nacionales covering plan members while they are in Mexico.
A handful of current cross-border plans come through U.S. employers, while the Health Net plans allow individuals to buy them directly, said Bobby Pena, spokesman for the California Association of Health Plans.
It wasn't immediately known if other states have similar programs.
"The issue of cross-border plans has been growing as the need for immigrant services has grown," said Pena.
One of Health Net's new programs, called Mexi-Plan, was developed with the help of the Mexican government.
An adult 19-39 will pay $75 a month under Mexi-Plan, while a family of four will pay around $300, said Andrade. Doctor visit copays in the United States are $15, and the plan covers 75 percent of hospitalization costs after a $2,500 deductible. Copays and deductibles are less in Mexico, she said.
Ruben Beltran, Mexican consul general for Los Angeles, said he approached Health Net in 2004 after in-house research found that access to health care was the second largest concern for Mexicans in the United States, after immigration status.
The idea was to develop a comprehensive plan that was open to illegal immigrants and didn't exceed the budgets of mostly low-wage earners, said Beltran.
Estimates vary on the number of immigrants, legal and illegal, who don't have health insurance.
In a study last year, the Rand Corporation found that 68 percent of illegal immigrants had no insurance, compared with 17 percent of U.S.-born Americans.
A young population and an inability to pay were determining factors for immigrants not getting insurance, said James Smith, an author of the study.
"I'm not sure who they (Health Net) are appealing to in this market," said Smith. "If you are healthy and poor, you don't spend money on health care."
The plans, believed to be the first of their kind in California, are open to people living in Los Angeles, Ventura and Orange counties, said Ana Andrade, vice president of Latino programs for Health Net of California.
Coverage areas include Mexican border cities of Tijuana, Tecate and Mexicali, with Mexican health care provider Sistemas Medicos Nacionales covering plan members while they are in Mexico.
A handful of current cross-border plans come through U.S. employers, while the Health Net plans allow individuals to buy them directly, said Bobby Pena, spokesman for the California Association of Health Plans.
It wasn't immediately known if other states have similar programs.
"The issue of cross-border plans has been growing as the need for immigrant services has grown," said Pena.
One of Health Net's new programs, called Mexi-Plan, was developed with the help of the Mexican government.
An adult 19-39 will pay $75 a month under Mexi-Plan, while a family of four will pay around $300, said Andrade. Doctor visit copays in the United States are $15, and the plan covers 75 percent of hospitalization costs after a $2,500 deductible. Copays and deductibles are less in Mexico, she said.
Ruben Beltran, Mexican consul general for Los Angeles, said he approached Health Net in 2004 after in-house research found that access to health care was the second largest concern for Mexicans in the United States, after immigration status.
The idea was to develop a comprehensive plan that was open to illegal immigrants and didn't exceed the budgets of mostly low-wage earners, said Beltran.
Estimates vary on the number of immigrants, legal and illegal, who don't have health insurance.
In a study last year, the Rand Corporation found that 68 percent of illegal immigrants had no insurance, compared with 17 percent of U.S.-born Americans.
A young population and an inability to pay were determining factors for immigrants not getting insurance, said James Smith, an author of the study.
"I'm not sure who they (Health Net) are appealing to in this market," said Smith. "If you are healthy and poor, you don't spend money on health care."
Auto Insurance Fraud
Mark Vogler
Staff Writer, The Eagle Tribune
LAWRENCE — Attorney Jorge A. Elias took off his glasses, rubbed his eyes and then closed them as if to hide evidence of any sadness he felt yesterday while being led from a third-floor courtroom to begin serving a 2<1/2>-year jail term for his role in the city's once-thriving auto insurance fraud industry.
"Clearly, the crime of fraudulent auto claims has been a major problem in the Lawrence area for years — decades," Superior Court Judge Howard J. Whitehead said before approving the sentence. Elias, 59, of Salem, Mass., was found guilty by a 12-member jury of conspiracy to commit auto insurance fraud.
"These crimes could not succeed without the involvement of the lawyer ... Mr. Elias was a key participant. ... He was acting as an instigator and a facilitator of these claims," the judge said.
After listening to lawyers' arguments and five prosecution witnesses over portions of four days, the six-man, six-woman jury deliberated nearly five hours before reaching the verdict.
Elias became personally involved in scams to set up staged accidents so he could profit from phony injury claims as part of an illegal enterprise so rampant that Lawrence was once nicknamed "the auto insurance fraud capital of Massachusetts."
Elias is the first person convicted and sentenced to jail of the 16 people — including three lawyers and four chiropractors — who were indicted in fall 2004 by a special grand jury investigating auto insurance fraud. At the outset of the trial, he faced a possible prison sentence of up to five years and a maximum of $10,000 if convicted.
Staff Writer, The Eagle Tribune
LAWRENCE — Attorney Jorge A. Elias took off his glasses, rubbed his eyes and then closed them as if to hide evidence of any sadness he felt yesterday while being led from a third-floor courtroom to begin serving a 2<1/2>-year jail term for his role in the city's once-thriving auto insurance fraud industry.
"Clearly, the crime of fraudulent auto claims has been a major problem in the Lawrence area for years — decades," Superior Court Judge Howard J. Whitehead said before approving the sentence. Elias, 59, of Salem, Mass., was found guilty by a 12-member jury of conspiracy to commit auto insurance fraud.
"These crimes could not succeed without the involvement of the lawyer ... Mr. Elias was a key participant. ... He was acting as an instigator and a facilitator of these claims," the judge said.
After listening to lawyers' arguments and five prosecution witnesses over portions of four days, the six-man, six-woman jury deliberated nearly five hours before reaching the verdict.
Elias became personally involved in scams to set up staged accidents so he could profit from phony injury claims as part of an illegal enterprise so rampant that Lawrence was once nicknamed "the auto insurance fraud capital of Massachusetts."
Elias is the first person convicted and sentenced to jail of the 16 people — including three lawyers and four chiropractors — who were indicted in fall 2004 by a special grand jury investigating auto insurance fraud. At the outset of the trial, he faced a possible prison sentence of up to five years and a maximum of $10,000 if convicted.
Tuesday, March 14, 2006
Personal and Portable Health Insurance
by John C. Goodman
NATIONAL CENTER FOR POLICY ANALYSIS
One of the peculiarities of the U.S. health care system is that the health plan most of us have is not a plan that we chose; rather, it was selected by our employer. Even if we like our health plan, we could easily lose coverage because of the loss of a job, a change in employment or a decision by our employer. These problems affect all Americans, but have the greatest impact on older workers, who are more likely to have health problems.
President Bush has proposed making health insurance individually-owned, personal and portable, traveling with employees from job to job. It is an idea whose time has come.
Problem: Lack of Continuity of Insurance. Virtually all employer health insurance contracts last only 12 months. At the end of the year, the employer — in search of ways to reduce costs — may switch health plans or cease providing health insurance altogether. The only people with private health insurance guaranteed to last longer than one year are people who purchase insurance on their own.
Problem: Lack of Continuity of Care. Employer-sponsored health care largely evolved when most health insurance was fee-for-service — which meant employees could see any doctor or enter any hospital and insurance paid all or most of the bills. As a result, a change of jobs usually did not cause undue disruption, provided that both the new and old employer had health insurance plans.
Things changed after the introduction of managed care. Today, employees who switch jobs must not only switch health plans, they often must change doctors as well, since each plan tends to have its own network. Additionally, different plans have different benefit packages. Thus some services, like mental health, may be covered under one employer's plan but not under the next employer's plan.
These disruptions affect some families more than others. For healthy people, they may amount to minor inconveniences. But if an employee (or a member of the employee's family) has a health problem, there may be an interruption in the continuity of care. One study of chronically ill workers found that those who rely on their employers for health coverage have less job mobility: They are 40 percent less likely to change jobs compared to similar workers who obtain health coverage elsewhere.
Problem: Perverse Incentives for Employers and Employees. Most employees view health insurance as a fringe benefit and primarily search for employment opportunities that reward them for their skills and abilities. But there is a growing minority of workers who approach the job market very differently. They have a family member (often a spouse or child) who has very high health care costs. When these workers compare job opportunities, they are primarily comparing health plans. For them, health insurance is the main attraction, rather than the job or the pay.
Clearly it is not in the financial self interest of employers to attract workers whose primary motivation is to get their medical bills paid. So, to protect themselves from such potential hires, employers are increasingly altering their health plans to attract the healthy and avoid the sick. Having small copayments for routine office visits and higher deductibles for hospitalization is one technique. Having long waiting periods before employees become eligible for the company's health plan is another.
These are rational responses by employers to a labor market that increasingly resembles a game of musical chairs. But what is good for the employer is not necessarily good for society.
Problem: Younger Spouses and Retirees on Medicare. The lack of individually-owned, portable insurance is particularly burdensome for many women who are married to older men. When husbands retire and enroll in Medicare, wives can be left without any coverage because Medicare won't allow enrollees to sign up underage spouses. If the couple has to purchase her insurance until she reaches 65 and also qualifies for Medicare, they have to do so with after-tax dollars. She will also be at a time in her life when she's charged higher premiums, since health risks tend to rise with age. And she'll pay even more (or possibly be denied insurance altogether) if she already has an expensive health problem or is recovering from a disease such as breast cancer.
Source of the Problem: Tax Penalties for Portable Insurance. Tax law is the main reason companies provide workers with health insurance rather than pay higher wages with which employees could buy their own insurance. People receiving employer-based health insurance enjoy an enormous tax advantage. Employer-paid premiums avoid federal, state and local income taxes, as well as the (FICA) payroll tax. By contrast, people who buy their own insurance get no tax break unless their medical costs exceed 7.5 percent of their adjusted gross income. Even then they get only a simple deduction and must itemize on their tax return. As a result, genuinely portable insurance is actually penalized under the tax law.
For a typical middle-class family, government effectively pays half the cost of employer-provided health insurance. To see what this means, suppose insurance for the family costs $6,000. If the insurance is purchased by an employer, it can be purchased with pretax dollars. This implies that the employee must earn $6,000 to set aside as pretax payment for insurance rather than as taxable wages. However, if the family directly purchased the insurance, the employee would have to earn $12,000 in order to have enough left over after paying taxes to purchase the insurance. In terms of the amount of pretax income needed to buy it, insurance purchased directly with after-tax dollars costs the family twice as much!
Source of the Problem: Federal Laws. Under the current system, employers cannot buy individually-owned insurance for their employees. Specifically, lawyers interpret the Health Insurance Portability and Accountability Act of 1996 (HIPAA) to say that the only employee health insurance employers can purchase with pretax dollars is group insurance. Ironically, the law that was designed to encourage portability effectively outlawed it.
Creating Personal and Portable Health Insurance. Just because employers pay all or most of the premium does not mean that health insurance must necessarily be employer-specific. As an alternative, why can't employees enroll in health plans that meet their needs and stay in those plans as they travel from job to job?
Employers should be able to buy personal and portable insurance for their employees. Even though employers initially would pay the premiums (as they do today), this insurance would be owned by the employees and would travel with them as they move through the labor market. Thus employees would get portability (a characteristic of individual insurance), but they would get it for premiums that are closer to the cost of group insurance.
Although employers would initially buy all of their employees into the same health plan, with the passage of time some of those employees will leave and go to work for other firms. Employers will also hire new employees who are members of other plans. And in most cases the employer's initial group of employees will be able to switch to other plans after a transition period. Indeed, it is possible that every employee will be in a different plan.
A Transition Plan. Some years ago, the National Center for Policy Analysis and Blue Cross/Blue Shield of Texas proposed a detailed plan to transition from group insurance to personal and portable insurance. [See http://cdhc.ncpa.org/news/making-health-insurance-portable.] This plan could form the basis for President Bush's nationwide proposal.
Advantages of Portable Insurance. Portable health insurance promises a continuing relationship with an insurer and, therefore, a continuing relationship with doctors and health facilities. It also promises that if people like their health plan, they will be able to stay in it — without worrying about an employer's decision or a change in employment.
For employers, portable health insurance means that small groups are no longer treated as self-contained pools and rated each year based on changes in the health status of their employees. Instead, their employees will be members of very large pools in which no one can be singled out because of a sudden, large medical expense, and premium increases are the same for all. Employers can limit their contribution to a fixed-dollar amount. New hires will know how much the employer is going to contribute to health insurance, just as they know the amount of their salary. Because the employer's role is largely financial, in a real sense employers will get out of the "business" of health insurance.
NATIONAL CENTER FOR POLICY ANALYSIS
One of the peculiarities of the U.S. health care system is that the health plan most of us have is not a plan that we chose; rather, it was selected by our employer. Even if we like our health plan, we could easily lose coverage because of the loss of a job, a change in employment or a decision by our employer. These problems affect all Americans, but have the greatest impact on older workers, who are more likely to have health problems.
President Bush has proposed making health insurance individually-owned, personal and portable, traveling with employees from job to job. It is an idea whose time has come.
Problem: Lack of Continuity of Insurance. Virtually all employer health insurance contracts last only 12 months. At the end of the year, the employer — in search of ways to reduce costs — may switch health plans or cease providing health insurance altogether. The only people with private health insurance guaranteed to last longer than one year are people who purchase insurance on their own.
Problem: Lack of Continuity of Care. Employer-sponsored health care largely evolved when most health insurance was fee-for-service — which meant employees could see any doctor or enter any hospital and insurance paid all or most of the bills. As a result, a change of jobs usually did not cause undue disruption, provided that both the new and old employer had health insurance plans.
Things changed after the introduction of managed care. Today, employees who switch jobs must not only switch health plans, they often must change doctors as well, since each plan tends to have its own network. Additionally, different plans have different benefit packages. Thus some services, like mental health, may be covered under one employer's plan but not under the next employer's plan.
These disruptions affect some families more than others. For healthy people, they may amount to minor inconveniences. But if an employee (or a member of the employee's family) has a health problem, there may be an interruption in the continuity of care. One study of chronically ill workers found that those who rely on their employers for health coverage have less job mobility: They are 40 percent less likely to change jobs compared to similar workers who obtain health coverage elsewhere.
Problem: Perverse Incentives for Employers and Employees. Most employees view health insurance as a fringe benefit and primarily search for employment opportunities that reward them for their skills and abilities. But there is a growing minority of workers who approach the job market very differently. They have a family member (often a spouse or child) who has very high health care costs. When these workers compare job opportunities, they are primarily comparing health plans. For them, health insurance is the main attraction, rather than the job or the pay.
Clearly it is not in the financial self interest of employers to attract workers whose primary motivation is to get their medical bills paid. So, to protect themselves from such potential hires, employers are increasingly altering their health plans to attract the healthy and avoid the sick. Having small copayments for routine office visits and higher deductibles for hospitalization is one technique. Having long waiting periods before employees become eligible for the company's health plan is another.
These are rational responses by employers to a labor market that increasingly resembles a game of musical chairs. But what is good for the employer is not necessarily good for society.
Problem: Younger Spouses and Retirees on Medicare. The lack of individually-owned, portable insurance is particularly burdensome for many women who are married to older men. When husbands retire and enroll in Medicare, wives can be left without any coverage because Medicare won't allow enrollees to sign up underage spouses. If the couple has to purchase her insurance until she reaches 65 and also qualifies for Medicare, they have to do so with after-tax dollars. She will also be at a time in her life when she's charged higher premiums, since health risks tend to rise with age. And she'll pay even more (or possibly be denied insurance altogether) if she already has an expensive health problem or is recovering from a disease such as breast cancer.
Source of the Problem: Tax Penalties for Portable Insurance. Tax law is the main reason companies provide workers with health insurance rather than pay higher wages with which employees could buy their own insurance. People receiving employer-based health insurance enjoy an enormous tax advantage. Employer-paid premiums avoid federal, state and local income taxes, as well as the (FICA) payroll tax. By contrast, people who buy their own insurance get no tax break unless their medical costs exceed 7.5 percent of their adjusted gross income. Even then they get only a simple deduction and must itemize on their tax return. As a result, genuinely portable insurance is actually penalized under the tax law.
For a typical middle-class family, government effectively pays half the cost of employer-provided health insurance. To see what this means, suppose insurance for the family costs $6,000. If the insurance is purchased by an employer, it can be purchased with pretax dollars. This implies that the employee must earn $6,000 to set aside as pretax payment for insurance rather than as taxable wages. However, if the family directly purchased the insurance, the employee would have to earn $12,000 in order to have enough left over after paying taxes to purchase the insurance. In terms of the amount of pretax income needed to buy it, insurance purchased directly with after-tax dollars costs the family twice as much!
Source of the Problem: Federal Laws. Under the current system, employers cannot buy individually-owned insurance for their employees. Specifically, lawyers interpret the Health Insurance Portability and Accountability Act of 1996 (HIPAA) to say that the only employee health insurance employers can purchase with pretax dollars is group insurance. Ironically, the law that was designed to encourage portability effectively outlawed it.
Creating Personal and Portable Health Insurance. Just because employers pay all or most of the premium does not mean that health insurance must necessarily be employer-specific. As an alternative, why can't employees enroll in health plans that meet their needs and stay in those plans as they travel from job to job?
Employers should be able to buy personal and portable insurance for their employees. Even though employers initially would pay the premiums (as they do today), this insurance would be owned by the employees and would travel with them as they move through the labor market. Thus employees would get portability (a characteristic of individual insurance), but they would get it for premiums that are closer to the cost of group insurance.
Although employers would initially buy all of their employees into the same health plan, with the passage of time some of those employees will leave and go to work for other firms. Employers will also hire new employees who are members of other plans. And in most cases the employer's initial group of employees will be able to switch to other plans after a transition period. Indeed, it is possible that every employee will be in a different plan.
A Transition Plan. Some years ago, the National Center for Policy Analysis and Blue Cross/Blue Shield of Texas proposed a detailed plan to transition from group insurance to personal and portable insurance. [See http://cdhc.ncpa.org/news/making-health-insurance-portable.] This plan could form the basis for President Bush's nationwide proposal.
Advantages of Portable Insurance. Portable health insurance promises a continuing relationship with an insurer and, therefore, a continuing relationship with doctors and health facilities. It also promises that if people like their health plan, they will be able to stay in it — without worrying about an employer's decision or a change in employment.
For employers, portable health insurance means that small groups are no longer treated as self-contained pools and rated each year based on changes in the health status of their employees. Instead, their employees will be members of very large pools in which no one can be singled out because of a sudden, large medical expense, and premium increases are the same for all. Employers can limit their contribution to a fixed-dollar amount. New hires will know how much the employer is going to contribute to health insurance, just as they know the amount of their salary. Because the employer's role is largely financial, in a real sense employers will get out of the "business" of health insurance.
Fresno, Calif., Qualifies for California Low-Cost Auto Insurance Program
March 14, 2006
Insurance Commissioner Garamendi has announced that the California Low Cost Automobile Insurance program will launch in Fresno County on April 1, bringing an opportunity for eligible low income good drivers to get state-required liability insurance for under $400 a year.
Recent legislation, Senate Bill 20 sponsored by the Commissioner, expanded the program to the counties of Fresno, Alameda, Orange, Riverside, San Bernardino and San Diego, effective April 1. The legislation also authorized the Commissioner to launch the program throughout the state based upon his determination of need and a public meeting to solicit public input. The Commissioner announced his plans in January to expand the program to eight additional counties: Santa Clara, San Mateo, Imperial, Kern, Sacramento, San Joaquin, Contra Costa, and Stanislaus.
Sen. Martha Escutia, D-Montebello, said the program is key to improving the lives of many who cannot afford insurance now. "My goal in creating the Low Cost Auto Insurance Program six years ago was to provide an affordable alternative for consumers who are required to have, but simply cannot afford, a conventional policy," said Sen. Escutia. "The expansion of the program to additional California counties is a blessing for many working families who are searching for affordable auto insurance."
The California Low Cost Automobile Insurance program was created in 1999 to provide low income good drivers with access to affordable automobile insurance. Currently, the program is only available in Los Angeles and San Francisco counties. With the additional counties permitted by SB 20, eligible motorists from 16 counties will soon be able to take advantage of the program. Program policies are issued by California licensed insurers and the program is administered by the California Automobile Assigned Risk Plan. Rates are set in each county so that premiums are sufficient to cover losses and expenses in each county.
To be eligible for the program, applicants must be a "good driver" – no more than one at-fault property damage only accident, or one point for a moving violation in the past three years; and no at-fault accident involving bodily injury or death in the past three years; and no felony or misdemeanor conviction for a violation of the Vehicle Code.
Additionally, family income cannot exceed 250 percent of the federal poverty level ($24,500 for a single person, $33,000 for two persons and $50,000 for a family of four). The value of an insured vehicle must not exceed $20,000. For more information about the program, call (866) 602-8861.
Insurance Commissioner Garamendi has announced that the California Low Cost Automobile Insurance program will launch in Fresno County on April 1, bringing an opportunity for eligible low income good drivers to get state-required liability insurance for under $400 a year.
Recent legislation, Senate Bill 20 sponsored by the Commissioner, expanded the program to the counties of Fresno, Alameda, Orange, Riverside, San Bernardino and San Diego, effective April 1. The legislation also authorized the Commissioner to launch the program throughout the state based upon his determination of need and a public meeting to solicit public input. The Commissioner announced his plans in January to expand the program to eight additional counties: Santa Clara, San Mateo, Imperial, Kern, Sacramento, San Joaquin, Contra Costa, and Stanislaus.
Sen. Martha Escutia, D-Montebello, said the program is key to improving the lives of many who cannot afford insurance now. "My goal in creating the Low Cost Auto Insurance Program six years ago was to provide an affordable alternative for consumers who are required to have, but simply cannot afford, a conventional policy," said Sen. Escutia. "The expansion of the program to additional California counties is a blessing for many working families who are searching for affordable auto insurance."
The California Low Cost Automobile Insurance program was created in 1999 to provide low income good drivers with access to affordable automobile insurance. Currently, the program is only available in Los Angeles and San Francisco counties. With the additional counties permitted by SB 20, eligible motorists from 16 counties will soon be able to take advantage of the program. Program policies are issued by California licensed insurers and the program is administered by the California Automobile Assigned Risk Plan. Rates are set in each county so that premiums are sufficient to cover losses and expenses in each county.
To be eligible for the program, applicants must be a "good driver" – no more than one at-fault property damage only accident, or one point for a moving violation in the past three years; and no at-fault accident involving bodily injury or death in the past three years; and no felony or misdemeanor conviction for a violation of the Vehicle Code.
Additionally, family income cannot exceed 250 percent of the federal poverty level ($24,500 for a single person, $33,000 for two persons and $50,000 for a family of four). The value of an insured vehicle must not exceed $20,000. For more information about the program, call (866) 602-8861.
Monday, March 13, 2006
Children's health insurance plan
The coalition working to increase the availability of health insurance for children announced that families may be signing up as early as July.
The steering committee for the Children's Health Initiative met recently to move forward with plans to insure at least 1,500 Humboldt County children.
The coalition is following a model across the state -- including Del Norte County, which started on this work more than a year ago -- to make sure all children can get health insurance. The effort includes signing up children who qualify for the state-subsidized Medi-Cal and Healthy Families programs and creating insurance to offer to families who don't qualify for those programs.
The group learned that the California HealthCare Foundation has agreed to a five-to-one match to cover premiums for children signed up for the CaliforniaKids program. That will likely bring about $500,000 dollars into the county to provide health care for children of the working poor.
The program is being developed for those who don't have private insurance and aren't eligible for Medi-Cal or Healthy Families. Medical, dental and
vision care will be covered. Families will pay a small percentage of the premium but no more than $20 per child.
The Humboldt County Department of Health and Human Services, the Community Health Alliance of Humboldt-Del Norte, First 5 Humboldt, St. Joseph Health System, Mad River Community Hospital, schools, clergy and others have been working since August 2005 to find a way to raise funds to provide insurance for all of Humboldt County's children.
”It has been remarkable how much support we've been able to secure in our community and throughout the state in such a short amount of time,” said Humboldt County Supervisor Bonnie Neely in a press release. Neely is co-chair of the Children's Health Initiative along with 5th District Supervisor Jill Geist.
The steering committee for the Children's Health Initiative met recently to move forward with plans to insure at least 1,500 Humboldt County children.
The coalition is following a model across the state -- including Del Norte County, which started on this work more than a year ago -- to make sure all children can get health insurance. The effort includes signing up children who qualify for the state-subsidized Medi-Cal and Healthy Families programs and creating insurance to offer to families who don't qualify for those programs.
The group learned that the California HealthCare Foundation has agreed to a five-to-one match to cover premiums for children signed up for the CaliforniaKids program. That will likely bring about $500,000 dollars into the county to provide health care for children of the working poor.
The program is being developed for those who don't have private insurance and aren't eligible for Medi-Cal or Healthy Families. Medical, dental and
vision care will be covered. Families will pay a small percentage of the premium but no more than $20 per child.
The Humboldt County Department of Health and Human Services, the Community Health Alliance of Humboldt-Del Norte, First 5 Humboldt, St. Joseph Health System, Mad River Community Hospital, schools, clergy and others have been working since August 2005 to find a way to raise funds to provide insurance for all of Humboldt County's children.
”It has been remarkable how much support we've been able to secure in our community and throughout the state in such a short amount of time,” said Humboldt County Supervisor Bonnie Neely in a press release. Neely is co-chair of the Children's Health Initiative along with 5th District Supervisor Jill Geist.
AUTO INSURANCE: Premium policies offer accident forgiveness
It seems like you can get a premium service for just about anything these days, so why should your auto insurance be any different?
You may have noticed TV commercials for Allstate's new insurance extras, such as accident forgiveness, which keeps your rates from being raised after a crash, and for new car replacement.
There's a catch, of course. You have to pay for these extras so even if you hate the way insurers boost your premiums for fender benders that weren't your fault, think before you buy.
Allstate is selling two premium policies, the Gold Protection and Platinum Protection plans.
Gold plan drivers pay an extra 5% to 7% on average above the standard policy. They receive a $100 reduction on their deductible for each year they are accident-free up to $500 and a guarantee that their premiums will not increase after a first accident.
The Platinum plan costs 14% to 15% more than the standard policy and comes with accident forgiveness for multiple accidents and a 5% discount on your premium while you remain accident-free.
The new car replacement add-on costs another 2% and is intended to cover drivers for the rapid depreciation of a new car. If your car is totaled within three years of its purchase, Allstate will buy you a new one rather than pay you the depreciated value.
Allstate spokesman George Nolan says the coverage may not be for everyone but says the company created the products to fit demand.
So how good a deal are these premium services? For starters, you may already be getting some of those features for free.
Many insurers, including Allstate, give drivers a discount for remaining accident-free for three or five years, so don't pay 15% more for that 5% discount if you're already eligible.
As for accident forgiveness, it's true that insurers often raise your rates after a crash. But Nationwide forgives a single accident and multiple minor ones after three years of safe driving and it doesn't cost you a penny more.
When it comes to new car replacement, the chances that your shiny new auto will be totaled (not just damaged) as you drive it off the lot are slim, but if the new vehicle is expensive and the worst happens, you will indeed be out the amount of depreciation, which could be thousands of dollars.
Before you buy the add-on, though, check to see if your financing company can provide similar coverage at better rates.
You may have noticed TV commercials for Allstate's new insurance extras, such as accident forgiveness, which keeps your rates from being raised after a crash, and for new car replacement.
There's a catch, of course. You have to pay for these extras so even if you hate the way insurers boost your premiums for fender benders that weren't your fault, think before you buy.
Allstate is selling two premium policies, the Gold Protection and Platinum Protection plans.
Gold plan drivers pay an extra 5% to 7% on average above the standard policy. They receive a $100 reduction on their deductible for each year they are accident-free up to $500 and a guarantee that their premiums will not increase after a first accident.
The Platinum plan costs 14% to 15% more than the standard policy and comes with accident forgiveness for multiple accidents and a 5% discount on your premium while you remain accident-free.
The new car replacement add-on costs another 2% and is intended to cover drivers for the rapid depreciation of a new car. If your car is totaled within three years of its purchase, Allstate will buy you a new one rather than pay you the depreciated value.
Allstate spokesman George Nolan says the coverage may not be for everyone but says the company created the products to fit demand.
So how good a deal are these premium services? For starters, you may already be getting some of those features for free.
Many insurers, including Allstate, give drivers a discount for remaining accident-free for three or five years, so don't pay 15% more for that 5% discount if you're already eligible.
As for accident forgiveness, it's true that insurers often raise your rates after a crash. But Nationwide forgives a single accident and multiple minor ones after three years of safe driving and it doesn't cost you a penny more.
When it comes to new car replacement, the chances that your shiny new auto will be totaled (not just damaged) as you drive it off the lot are slim, but if the new vehicle is expensive and the worst happens, you will indeed be out the amount of depreciation, which could be thousands of dollars.
Before you buy the add-on, though, check to see if your financing company can provide similar coverage at better rates.
Friday, March 10, 2006
AFFORDABLE HEALTH CARE INSURANCE?
Nursing home costs are likely to approach $175,000 a year by 2021, according to ConsumerReports.org, a figure large enough to strike fear into the hearts of even the most well-heeled individual.
Complicating matters is the difficulty of choosing a long-term care health insurance plan, paying premiums for many years, and then having confidence that the coverage will kick in as advertised, when and if needed.
The Managing Your Wealth column of Connect With Vanguard offers some suggestions on how to deal with the issue. They advise:
·Buy a policy with nonforfeiture benefits (even though this may add 30 percent to the policy’s base cost).
·Purchase an indemnity-based policy, which kicks in once a chronic disability has been established.
·Add an inflation-protection rider.
·See if your premiums, all or in part, may be deductible on Federal income taxes.
Complicating matters is the difficulty of choosing a long-term care health insurance plan, paying premiums for many years, and then having confidence that the coverage will kick in as advertised, when and if needed.
The Managing Your Wealth column of Connect With Vanguard offers some suggestions on how to deal with the issue. They advise:
·Buy a policy with nonforfeiture benefits (even though this may add 30 percent to the policy’s base cost).
·Purchase an indemnity-based policy, which kicks in once a chronic disability has been established.
·Add an inflation-protection rider.
·See if your premiums, all or in part, may be deductible on Federal income taxes.
N.C. Schedules June Auto Insurance Rate Hearing
From Insurance Journal
March 10, 2006
North Carolina Insurance Commissioner Jim Long has announced a hearing on auto insurance rates will be held in Raleigh in June and recently requested rate increases will be denied until after the hearings.
This announcement comes after the North Carolina Rate Bureau, an independent organization that represents all auto insurance companies in the state, filed for a 6.7 percent increase in rates on Feb. 1. However, the Bureau recently has informed the department about a data error that will revise their initial request to a 7.6 percent overall increase.
Department officials reviewed the rate filing and determined that the requested increase was not justified. State law requires commissioner Long to serve as hearing officer during a hearing to decide the matter. Auto rate hearings typically encompass three to four weeks of testimony from both sides; however, 2005's hearings lasted more than four months.
"This filing came on the heels of the 2005 settlement where commissioner Long ordered an overall decrease in auto rates," Sherri Hubbard, the department's lead rate attorney on this case said. "So why now, only a month later, do North Carolinians need an increase after years of low rates from financially sound companies?"
Last month, Long ordered a 2.5 percent overall decrease in auto rates when the Bureau requested a 9.6 percent increase, and in 2004, the department negotiated a zero percent change in rates instead of the requested 12.3 percent increase.
Long will decide what rate change, if any, is warranted during the hearing. If the Bureau wishes to appeal his decision, it can do so through the court system and companies can raise rates while awaiting an appeals decision. The difference in the ordered rate and the implemented rate must be held in escrow. If the Bureau loses its appeal, the escrowed money must be refunded to policyholders who paid too much.
In 2004, the resolution of two such appealed cases resulted in an auto rate refund worth several hundred million dollars. In October and November 2004, North Carolina drivers received refund checks, often for hundreds of dollars. The two cases were from 2001 and 2002; the 2001 case was decided in North Carolina Supreme Court, which ruled in Long's favor. The 2002 case was settled out of court quickly after that.
In 20 years as insurance commissioner, Long has kept auto rates low by negotiating minimal increases or, in most cases, rate decreases. He has saved drivers as much as $4.2 billion in potential premiums resulting in North Carolina having the fifth lowest auto rates in the country.
March 10, 2006
North Carolina Insurance Commissioner Jim Long has announced a hearing on auto insurance rates will be held in Raleigh in June and recently requested rate increases will be denied until after the hearings.
This announcement comes after the North Carolina Rate Bureau, an independent organization that represents all auto insurance companies in the state, filed for a 6.7 percent increase in rates on Feb. 1. However, the Bureau recently has informed the department about a data error that will revise their initial request to a 7.6 percent overall increase.
Department officials reviewed the rate filing and determined that the requested increase was not justified. State law requires commissioner Long to serve as hearing officer during a hearing to decide the matter. Auto rate hearings typically encompass three to four weeks of testimony from both sides; however, 2005's hearings lasted more than four months.
"This filing came on the heels of the 2005 settlement where commissioner Long ordered an overall decrease in auto rates," Sherri Hubbard, the department's lead rate attorney on this case said. "So why now, only a month later, do North Carolinians need an increase after years of low rates from financially sound companies?"
Last month, Long ordered a 2.5 percent overall decrease in auto rates when the Bureau requested a 9.6 percent increase, and in 2004, the department negotiated a zero percent change in rates instead of the requested 12.3 percent increase.
Long will decide what rate change, if any, is warranted during the hearing. If the Bureau wishes to appeal his decision, it can do so through the court system and companies can raise rates while awaiting an appeals decision. The difference in the ordered rate and the implemented rate must be held in escrow. If the Bureau loses its appeal, the escrowed money must be refunded to policyholders who paid too much.
In 2004, the resolution of two such appealed cases resulted in an auto rate refund worth several hundred million dollars. In October and November 2004, North Carolina drivers received refund checks, often for hundreds of dollars. The two cases were from 2001 and 2002; the 2001 case was decided in North Carolina Supreme Court, which ruled in Long's favor. The 2002 case was settled out of court quickly after that.
In 20 years as insurance commissioner, Long has kept auto rates low by negotiating minimal increases or, in most cases, rate decreases. He has saved drivers as much as $4.2 billion in potential premiums resulting in North Carolina having the fifth lowest auto rates in the country.
Thursday, March 9, 2006
Bill May Require Companies to Provide Health Insurance
NEW YORK, NY, March 08, 2006 — Many companies in New York State may soon be required to provide health insurance for their employees.
Lawmakers in Albany have introduced bills that are similar to one introduced in New Jersey that would require companies with more than 100 workers to pay at least 8 percent of their payroll for health coverage. The New York bills which would affect 450,000 workers who currently don't have health coverage have bipartisan support.
The push for the bill comes after a similar one passed in Maryland that was aimed at forcing Wal-Mart to provide better health care coverage.
Lawmakers in Albany have introduced bills that are similar to one introduced in New Jersey that would require companies with more than 100 workers to pay at least 8 percent of their payroll for health coverage. The New York bills which would affect 450,000 workers who currently don't have health coverage have bipartisan support.
The push for the bill comes after a similar one passed in Maryland that was aimed at forcing Wal-Mart to provide better health care coverage.
Wednesday, March 8, 2006
Wal Mart not only targeted on Health Insurance
Wal-Mart CEO Lee Scott trooped before the National Governors Association several days ago to beg for leniency concerning the AFL-CIO’s attempt in 30-odd states to gain enactment of so-called “Wal-Mart laws” requiring big employers to spend as much as 9 percent of payroll on health insurance or else pony up the difference in taxes. Liberal elements of the political class are seizing an opportunity to push health care mandates once again.
The public theory behind the “Wal-Mart laws” is that supposedly low-wage employers are shirking their “duty” to provide a health-care entitlement to their workers. As a result these workers take advantage of state Medicaid programs, and therefore employers who do provide health benefits end up subsidizing those who don’t via state taxes.
The grubbier reality: Wal-Mart long has been a target of largely unsuccessful union organizing activity. That may have much to do with the AFL-CIO’s sudden interest in Wal-Mart workers’ health care benefits.
In a health care entitlement, it seems, the AFL-CIO finally has a foothold against its nemesis. A closer look, however, reveals much bigger plans for the unionist health measures. While Maryland famously passed a law that effectively applies only to Wal-Mart, elsewhere AFL-CIO drafts would broadly include most employers in a pay-or-tax health insurance scheme.
The underlying assumption of the entire debate is that employers should be obliged to provide comprehensive health care to their employees — everything from minor expenses to major hospitalization. State Medicaid programs largely have taken the same approach; it’s little wonder that Medicaid benefits may look attractive compared to affordable, high-deductible health insurance that actually functions as insurance by providing protection against large expenses but not small ones.
The average cost of employer-provided health insurance is quickly approaching the cost of a 30-year mortgage on an average-priced home. Are employers next to be expected to provide homes as well as routine health care? What about cars? Most people need those, too. Follow this logic to its conclusion and what you have is something resembling indentured servitude, with all major life expenses provided by the employer through a government mandate. It’s obviously not a sustainable model.
Rather than attempt to impose a mandate for entitlement-style health care, policymakers should look for ways to infuse health care with something resembling market competition — beginning with making it easier for individuals to buy high-deductible individual health insurance apart from their employers.
The public theory behind the “Wal-Mart laws” is that supposedly low-wage employers are shirking their “duty” to provide a health-care entitlement to their workers. As a result these workers take advantage of state Medicaid programs, and therefore employers who do provide health benefits end up subsidizing those who don’t via state taxes.
The grubbier reality: Wal-Mart long has been a target of largely unsuccessful union organizing activity. That may have much to do with the AFL-CIO’s sudden interest in Wal-Mart workers’ health care benefits.
In a health care entitlement, it seems, the AFL-CIO finally has a foothold against its nemesis. A closer look, however, reveals much bigger plans for the unionist health measures. While Maryland famously passed a law that effectively applies only to Wal-Mart, elsewhere AFL-CIO drafts would broadly include most employers in a pay-or-tax health insurance scheme.
The underlying assumption of the entire debate is that employers should be obliged to provide comprehensive health care to their employees — everything from minor expenses to major hospitalization. State Medicaid programs largely have taken the same approach; it’s little wonder that Medicaid benefits may look attractive compared to affordable, high-deductible health insurance that actually functions as insurance by providing protection against large expenses but not small ones.
The average cost of employer-provided health insurance is quickly approaching the cost of a 30-year mortgage on an average-priced home. Are employers next to be expected to provide homes as well as routine health care? What about cars? Most people need those, too. Follow this logic to its conclusion and what you have is something resembling indentured servitude, with all major life expenses provided by the employer through a government mandate. It’s obviously not a sustainable model.
Rather than attempt to impose a mandate for entitlement-style health care, policymakers should look for ways to infuse health care with something resembling market competition — beginning with making it easier for individuals to buy high-deductible individual health insurance apart from their employers.
Tuesday, March 7, 2006
NAMIC Supports Sunset of Florida's No-Fault Auto Insurance Law
From Insurance Journal
The National Association of Mutual Insurance Companies has announced it supports Floridians for Lower Insurance Costs and opposes the reinstatement of the state's no-fault auto insurance law and will state its position to the Florida Legislature when it convenes March 7. The Florida Legislature is expected to continue through May 5.
David Reddick, NAMIC's senior state advocacy manager said NAMIC, which represents 125 member companies doing business in Florida, has joined other industry representatives in supporting Floridians for Lower Insurance Costs, a coalition of concerned citizens, businesses and taxpayers concerned about the growing waste, fraud and abuse in the current no-fault system. More information about the coalition is available at www.lowerinsurancecosts.org.
"It's clear to us that the no-fault system isn't working in Florida," Reddick said. "The average Florida family is paying at least $250 a year more than it should for auto insurance."
Three years ago, the Florida Legislature enacted a provision calling for the no-fault law to sunset in 2007 unless lawmakers reenacted it during the 2006 legislative session. Senate Proposed Bill (SPB) 7094 has been introduced and forwarded to the Senate Banking and Insurance Committee. The bill proposes a medical fee schedule for PIP set at a specified percentage above the Medicare fee schedule and eliminates the contingency risk multiplier applied to attorney fee awards.
"We know several auto insurers favor the reforms contained in SPB 7094, but once the legislative debate gets under way, the reenactment provisions are likely to be watered down so much that substantive reform isn't going to be possible," Reddick said. "That is why NAMIC simply favors letting the no-fault law sunset next year."
Reddick said the other major insurance bill before lawmakers this year is a property bill (PCB IN 06-01), which is in the House Insurance Committee. He said this bill proposes several changes to Citizens Property Insurance Corporation, the insurer of last resort, including new benchmarks for determining Citizens' rates and a prohibition on insuring single-family residences in excess of $1 million.
"The bill contains a provision requiring our insurers to perform all the servicing and claims functions on the windstorm portion of homeowner's policies," Reddick said. "That will be problematic for some of our members."
A second provision would create a "flex band" for personal lines coverage where a filed rate would be considered excessive if it represented more than a 10 percent statewide average change from the then-current lawful rate and no more than a 25 percent change in any one rating territory.
"It is too early in the legislative process to know if this provision will stay in the bill," Reddick said, adding, "Based on past sessions, it is unlikely to survive."
A total of 125 NAMIC member companies write 37 percent of the homeowners insurance and 34 percent of the automobile insurance in Florida.
The National Association of Mutual Insurance Companies has announced it supports Floridians for Lower Insurance Costs and opposes the reinstatement of the state's no-fault auto insurance law and will state its position to the Florida Legislature when it convenes March 7. The Florida Legislature is expected to continue through May 5.
David Reddick, NAMIC's senior state advocacy manager said NAMIC, which represents 125 member companies doing business in Florida, has joined other industry representatives in supporting Floridians for Lower Insurance Costs, a coalition of concerned citizens, businesses and taxpayers concerned about the growing waste, fraud and abuse in the current no-fault system. More information about the coalition is available at www.lowerinsurancecosts.org.
"It's clear to us that the no-fault system isn't working in Florida," Reddick said. "The average Florida family is paying at least $250 a year more than it should for auto insurance."
Three years ago, the Florida Legislature enacted a provision calling for the no-fault law to sunset in 2007 unless lawmakers reenacted it during the 2006 legislative session. Senate Proposed Bill (SPB) 7094 has been introduced and forwarded to the Senate Banking and Insurance Committee. The bill proposes a medical fee schedule for PIP set at a specified percentage above the Medicare fee schedule and eliminates the contingency risk multiplier applied to attorney fee awards.
"We know several auto insurers favor the reforms contained in SPB 7094, but once the legislative debate gets under way, the reenactment provisions are likely to be watered down so much that substantive reform isn't going to be possible," Reddick said. "That is why NAMIC simply favors letting the no-fault law sunset next year."
Reddick said the other major insurance bill before lawmakers this year is a property bill (PCB IN 06-01), which is in the House Insurance Committee. He said this bill proposes several changes to Citizens Property Insurance Corporation, the insurer of last resort, including new benchmarks for determining Citizens' rates and a prohibition on insuring single-family residences in excess of $1 million.
"The bill contains a provision requiring our insurers to perform all the servicing and claims functions on the windstorm portion of homeowner's policies," Reddick said. "That will be problematic for some of our members."
A second provision would create a "flex band" for personal lines coverage where a filed rate would be considered excessive if it represented more than a 10 percent statewide average change from the then-current lawful rate and no more than a 25 percent change in any one rating territory.
"It is too early in the legislative process to know if this provision will stay in the bill," Reddick said, adding, "Based on past sessions, it is unlikely to survive."
A total of 125 NAMIC member companies write 37 percent of the homeowners insurance and 34 percent of the automobile insurance in Florida.
Health Insurance tops reform agenda
Dr. Patricia Maryland, president of St. Vincent Hospitals and Health Services, discusses health care in America.
Question: You're on the Citizens' Health Working Group, a committee that's making recommendations on health-care reform to Congress and the president. What do you see as major issues?
Answer: Right now 1 in 7 people has no health insurance. By 2019, 1 in 3 won't. That's pretty significant. We've got to get our arms around it.
We know about the number of uninsured, but so many are underinsured. They're very bare and if anything major should happen to them, it could wipe out their savings.
Q: The committee is holding a community discussion Saturday. What do you plan to ask?
A: We're going to ask four general questions: What health-care benefits and services should be provided? How does the American public want their health care delivered? How should it be financed? And the most important question: What trade-offs are you willing to make?
We can't have everything. We spend $1.8 trillion a year for health care. If health care is going to be financed by the government and major employers, we need some dialogue about how people feel, what the basic level of services are that should be provided and what are you willing to give up. We can't pay for everything; it's just not possible.
Q: What do you see as some of the major changes in health care in the future?
A: The population is aging, and baby boomers are starting to face some major health challenges. And there are more of us. People are living longer, but because of this, they wind up with multiple chronic problems, and managing the care of a person with multiple chronic problems can be expensive.
Q: Do you think people are engaged with the issue?
A: Most of us have touched the health-care system in some way, whether it's through family, the person or friends.
What's important from an Indiana perspective, I believe, is we're trying to build more businesses. Those businesses need to be able to compete effectively, and the cost of health care is such that it's making them less competitive. Think about the automobile industry.
Question: You're on the Citizens' Health Working Group, a committee that's making recommendations on health-care reform to Congress and the president. What do you see as major issues?
Answer: Right now 1 in 7 people has no health insurance. By 2019, 1 in 3 won't. That's pretty significant. We've got to get our arms around it.
We know about the number of uninsured, but so many are underinsured. They're very bare and if anything major should happen to them, it could wipe out their savings.
Q: The committee is holding a community discussion Saturday. What do you plan to ask?
A: We're going to ask four general questions: What health-care benefits and services should be provided? How does the American public want their health care delivered? How should it be financed? And the most important question: What trade-offs are you willing to make?
We can't have everything. We spend $1.8 trillion a year for health care. If health care is going to be financed by the government and major employers, we need some dialogue about how people feel, what the basic level of services are that should be provided and what are you willing to give up. We can't pay for everything; it's just not possible.
Q: What do you see as some of the major changes in health care in the future?
A: The population is aging, and baby boomers are starting to face some major health challenges. And there are more of us. People are living longer, but because of this, they wind up with multiple chronic problems, and managing the care of a person with multiple chronic problems can be expensive.
Q: Do you think people are engaged with the issue?
A: Most of us have touched the health-care system in some way, whether it's through family, the person or friends.
What's important from an Indiana perspective, I believe, is we're trying to build more businesses. Those businesses need to be able to compete effectively, and the cost of health care is such that it's making them less competitive. Think about the automobile industry.
Monday, March 6, 2006
Easing Health Insurance burden
Providing employees with health coverage is a struggle for Carrie Howard, co-owner of DJ's Industrial Rubber Products, a six-employee Oklahoma City company that sells fire-hose fittings. Even with 2005 sales at $1 million, the company can't afford to cover its employees. Howard says, "If they could have a $20 co-pay, or any help with prescriptions, they would do it."
Howard, 42, and the company's employees could get help very soon from the state government. In November, Oklahoma started Oklahoma Employer/Employee Partnership for Insurance Coverage, a voter-approved statewide health insurance program for companies with fewer than 25 employees. Funded largely through a tobacco tax increase, the state picks up 60 percent of an employee's premium, the employer pays 25 percent, and the employee pays the remaining 15 percent.
The program will help Oklahoma's small employers provide benefits and reduce the number of Oklahoma's uninsured--currently 600,000. Within the first few weeks of the program, 206 companies had submitted applications, and its mailing list has ballooned to 4,500 subscribers. "We've had a ton of phone calls," says Matt Lucas, project director for the Oklahoma Health Care Authority, which is administering the employer/employee partnership. "It's a fairly innovative program."
Oklahoma isn't alone. An October 2005 study by the Kaiser Family Foundation on Medicaid and the Uninsured found 20 states have increased access to health-care options. Illinois' new All Kids plan will provide affordable health-care coverage to uninsured children of working parents. The Massachusetts legislature, meanwhile, is debating whether to require residents to carry health-care coverage via an employer, the government or a self-funded policy, with low-income individuals qualifying for a subsidy, and potential tax breaks for employers who provide health insurance.
"States are all over the map in terms of what they're doing," says John E. McDonough, executive director of Health Care For All, a Boston group advocating accessible and affordable health care for all Massachusetts residents. "Some states are looking at creative ways to help small employers."
State budgets are moving back into the black, and that's allowing them to pump money into once-dormant initiatives. In 2005, 45 states exceeded budget projections, and the other five met their targets, according to a recent report on states' fiscal health by the National Association of State Budget Officers. Compare this to 2003, when 37 states slashed spending halfway through their annual budget cycles.
"I don't think [states'] interest in this issue ever went away," says Alan R. Weil, executive director of the National Academy for State Health Policy, a Portland, Maine, nonprofit that analyzes state health-care policy and practices, "but a sense of not having the resources to do anything about it [put progress] on hold."
Entrepreneurs struggling to pay for employee health coverage have some new options, but they have to stay realistic: "The resources available to help small businesses afford health coverage are limited," Weil says. "But there are enough states trying to figure out how to extend some help to small businesses that it's a good idea to [look into] what's happening." Your state's insurance department is one place to start.
Paying attention paid off for Howard: She signed up for Oklahoma's new program the day it started taking applications. "I read [about] it in the paper a long time ago and just tried to keep up on it," she says. At press time, Howard was preparing to give employees insurance applications to fill out.
States still face their share of budgetary challenges; many states are in debt from borrowing heavily during the downturn. And demand for Medicaid continues to increase. The big question is how long politicians will leave it to states to triage a nationwide health-care crisis. "The only effective long-term solution will be national," says McDonough. "And it's not a real issue on the Washington, DC, radar at this point."
Howard, 42, and the company's employees could get help very soon from the state government. In November, Oklahoma started Oklahoma Employer/Employee Partnership for Insurance Coverage, a voter-approved statewide health insurance program for companies with fewer than 25 employees. Funded largely through a tobacco tax increase, the state picks up 60 percent of an employee's premium, the employer pays 25 percent, and the employee pays the remaining 15 percent.
The program will help Oklahoma's small employers provide benefits and reduce the number of Oklahoma's uninsured--currently 600,000. Within the first few weeks of the program, 206 companies had submitted applications, and its mailing list has ballooned to 4,500 subscribers. "We've had a ton of phone calls," says Matt Lucas, project director for the Oklahoma Health Care Authority, which is administering the employer/employee partnership. "It's a fairly innovative program."
Oklahoma isn't alone. An October 2005 study by the Kaiser Family Foundation on Medicaid and the Uninsured found 20 states have increased access to health-care options. Illinois' new All Kids plan will provide affordable health-care coverage to uninsured children of working parents. The Massachusetts legislature, meanwhile, is debating whether to require residents to carry health-care coverage via an employer, the government or a self-funded policy, with low-income individuals qualifying for a subsidy, and potential tax breaks for employers who provide health insurance.
"States are all over the map in terms of what they're doing," says John E. McDonough, executive director of Health Care For All, a Boston group advocating accessible and affordable health care for all Massachusetts residents. "Some states are looking at creative ways to help small employers."
State budgets are moving back into the black, and that's allowing them to pump money into once-dormant initiatives. In 2005, 45 states exceeded budget projections, and the other five met their targets, according to a recent report on states' fiscal health by the National Association of State Budget Officers. Compare this to 2003, when 37 states slashed spending halfway through their annual budget cycles.
"I don't think [states'] interest in this issue ever went away," says Alan R. Weil, executive director of the National Academy for State Health Policy, a Portland, Maine, nonprofit that analyzes state health-care policy and practices, "but a sense of not having the resources to do anything about it [put progress] on hold."
Entrepreneurs struggling to pay for employee health coverage have some new options, but they have to stay realistic: "The resources available to help small businesses afford health coverage are limited," Weil says. "But there are enough states trying to figure out how to extend some help to small businesses that it's a good idea to [look into] what's happening." Your state's insurance department is one place to start.
Paying attention paid off for Howard: She signed up for Oklahoma's new program the day it started taking applications. "I read [about] it in the paper a long time ago and just tried to keep up on it," she says. At press time, Howard was preparing to give employees insurance applications to fill out.
States still face their share of budgetary challenges; many states are in debt from borrowing heavily during the downturn. And demand for Medicaid continues to increase. The big question is how long politicians will leave it to states to triage a nationwide health-care crisis. "The only effective long-term solution will be national," says McDonough. "And it's not a real issue on the Washington, DC, radar at this point."
RJR Insurance Services, Inc. and Senior Healthcare Consultants Announce Promotions of Key Management
PRNewswire
IRVING, Texas, March 6 /PRNewswire/ -- RJR Insurance Services, Inc. (RJR) is pleased to announce promotions of key members of management in anticipation of sales projections.
David L. Chambers, CMO, RJR Insurance Services, Inc. (RJR)
RJR Focus: Exclusive Career Agent Distribution Systems Chambers possesses over 4 years of management and training with RJR. He has become highly skilled in its career agent distribution and specializes in developing and facilitating its neophyte (previously non-licensed) agent recruiting programs. Over the past 3 years he has been in charge of a distribution (SHC) responsible for generating well over $30,000,000 in senior market health insurance premium.
Previously: Regional Sales Manager Senior Healthcare Consultants (SHC); Vice President Senior Consultant Sales (SHC).
Robert A. Douglas, VP Senior Consultant Sales, Senior Healthcare Consultants (SHC)
SHC Focus: Senior Market Captive Agent Consultant Sales Force Douglas has over 20+ years of previous sales management experience and 3 years of sales training experience with SHC. While working with SHC he has played a key role in the implementation of web-conference training technology in an effort to improve new consultant/agent product knowledge and further facilitate the improvement of its training programs. He also successfully redesigned SHC's entire Base Consultant University (BCU), which serves as a virtual-classroom environment training program for educating product knowledge, market compliance, and the training of basic sales skills imperative to producer success with SHC.
IRVING, Texas, March 6 /PRNewswire/ -- RJR Insurance Services, Inc. (RJR) is pleased to announce promotions of key members of management in anticipation of sales projections.
David L. Chambers, CMO, RJR Insurance Services, Inc. (RJR)
RJR Focus: Exclusive Career Agent Distribution Systems Chambers possesses over 4 years of management and training with RJR. He has become highly skilled in its career agent distribution and specializes in developing and facilitating its neophyte (previously non-licensed) agent recruiting programs. Over the past 3 years he has been in charge of a distribution (SHC) responsible for generating well over $30,000,000 in senior market health insurance premium.
Previously: Regional Sales Manager Senior Healthcare Consultants (SHC); Vice President Senior Consultant Sales (SHC).
Robert A. Douglas, VP Senior Consultant Sales, Senior Healthcare Consultants (SHC)
SHC Focus: Senior Market Captive Agent Consultant Sales Force Douglas has over 20+ years of previous sales management experience and 3 years of sales training experience with SHC. While working with SHC he has played a key role in the implementation of web-conference training technology in an effort to improve new consultant/agent product knowledge and further facilitate the improvement of its training programs. He also successfully redesigned SHC's entire Base Consultant University (BCU), which serves as a virtual-classroom environment training program for educating product knowledge, market compliance, and the training of basic sales skills imperative to producer success with SHC.
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