Month: May 2010

This Week’s Headlines

This week, there have been numerous articles that discuss the Health Care bill, how it will affect certain groups, and how people perceive it.  Here are a few of those articles and the key points they address.


Towers Watson Study – Employers not dumping healthcare coverage for employees

· 661 large employers survey

· 94% believe health care reform will increase costs, but most expect to continue offering subsidized benefits to workers

· 80%  plan to pass the increases on to employees

· 74% percent anticipate reducing health benefits and programs.

· Higher  insurance co-payment or deductible hikes or more high-deductible plans,

· Nation survey spanned several industries and involved companies with a median size of 5,600 employees

· Survey found employers plan to continue offering health promotion and wellness programs

· 43 % of employers offering retiree benefits expect to reduce or eliminate them.

· 96% of respondents plan to reduce costs

· Healthcare Connect Key Editorial Point: costs were going up before reform




Study points to Health Law’s Penalties

· By Mercer (3,000 employers surveyed)

· If a company offers coverage but requires any full-time employees to pay premiums more than 9.5 percent of their household income, the coverage is deemed unaffordable = employer penalty

· 1/3 of employers had some workers for whom coverage might be “unaffordable”

· Employers with fewer than 50 employees are exempt

· Employers rarely have access to information on their employees’ household income, which may include the earnings of a spouse or children, interest from savings accounts and dividend income from stocks and mutual funds

· If an employer’s health plans is deemed unaffordable – employee may qualify for a federal tax credit/subsidy to buy coverage in the exchanges. To claim credit – employee discloses income information to the exchange. exchange notifies employers if any of their workers qualify for subsidies.

· Employers offering unaffordable coverage – subject to a penalty of $3,000 a year for each full-time employee who gets government assistance to buy insurance in an exchange. The max penalty is $2,000 times the total number of full time employees in excess of 30

· Retailers and restaurant with large numbers of low-wage workers may be most affected

· Cost of coverage for an employee alone or the cost of family coverage, which is usually higher. The government plans to issue regulations to explain what happens when a worker can afford individual but not family coverage (Rules not defined)

· To avoid the penalty for unaffordable coverage, employers could respond in several ways.

1. Increase their contributions to premiums

2. Reduce the workers’ share of premiums but recoup the money in other ways

3. Increasing co-payments or deductibles

4. They could offer lower-cost health plans, with less generous coverage


KHN – Kaiser Health News

Health Law’s “Grandfather” clause could deprive consumers of key benefits

· “Grandfathered” health plans exempt from several consumers protections, including a prohibition on charging co-payments, cost-sharing for certain preventative health services

· Congress included the provisions to give employers and insurers time to transition to the new la

· Plans that give up their grandfather status must abide by all consumer protections in the new law

· law does not give a date when the status expires

· Grandfather plans subject to some consumer protection

A. Dependant coverage for children until age 26

B. A ban on pre-existing condition exclusions for children this year and everyone in 2014

C. A prohibition on lifetime insurance limits

D. Grandfathered health plans will be blocked from retroactively cancelling coverage after a policy holder gets sick

· Grandfathered plans exempt from some consumer protections

A. Including health plans cover certain treatments associated with clinical trials

B. Limits annual out-of-pocket cost. In addition, grandfathered plans won’t have to meet new rules limiting how much premiums can vary based on age and tobacco use.


· SCHIP – Children’s Health Insurance

· $10 B Available to states through 2013

· Requires state funds

· Less than 50% of states have accessed the funds

· 15 states scaled back existing programs by raising premiums/increasing waiting periods/complicating the sign up process


Report: Healthcare law tax credits encourage small businesses to stay small, not hire

· National Center for Policy Analysis shows that tax credits in the new healthcare law could negatively impact small-business hiring decisions.

· New law provides a 50 % tax credit to companies offering health coverage that have fewer than 10 workers who, on average earn $25,000 a year. The tax credit is reduced as more employees are added to the payroll

· Reduction in tax relief to be a cost concern for companies looking to hire additional workers

· Business Owners who decide to hire an extra worker look at the worker’s salary, and the cost of losing the tax credit

· CBO – the study states that the credit reached its optimal point at 13 workers, with relief peaking at $36,400 for qualifying business

· Tax credits are available to businesses until 2016, 2 years after the healthcare exchanges are up and running.


Insurers may slash rates to hospitals – National trend to follow

· Massachusetts health insurers say they want to freeze or slash payments to some hospitals and large physicians groups this year.

· Insurers believe they have widespread backing from politicians, regulators, and employers to aggressively push back against large price increases, even if it means some unhappy providers drop out of insurers’ networks

· Blue Cross Blue Shield of Mass. the state’s largest insurer, this month sent letters to hospitals and large physician groups putting them on alert

· Contract negotiations between health insurers and hospitals always have been tense and long, and often disappointing for those providers with little market clout. But hospitals and doctors groups with top name brands, large numbers of patients, or geographical dominance have been able to substantially raise their prices, sometimes with the backing of employer

· Blue Cross executives said their negotiating strategy will depend on a hospital’s situation


Young Americans Big Gains

· 1/3 of the estimated 45 Million Americans without insurance are young adults 19-29 (13.7M)

· This group will gain most when law goes into effect in 2014 according to The Common Wealth Fund (private research foundation)

· Either through Medicaid/Exchanges/Staying Parents policies

· 2014

A. 7.1 M <133% of poverty level – MCAID

B. 5.6 M Through exchanges (w/subsidies)

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Some Recent Questions to RubinHealth

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Here are some of the types of questions RubinHealth has received since the passing of the recent Healthcare Bill.  This is a complex topic that many people have questions about, so feel free to email us or call into Dr. Radio on Sirius Radio – Thursdays between 12 and 2 EST- at 877-698-3627, and hopefully RubinHealth can help you understand what matters most to you.

Q: Where can I access the new health reform law document for my own reference? I know it is out there but where?

A: has good information and links to the bills, as does


Q: I have an individual insurance policy with no coverage for brand name drugs, but I do have coverage for generics. Next month my premium will increase, but I can not drop it due to some health problems.  I’m interested in finding out if I will receive a subsidy to help out with my premiums.  When would those subsidies scheduled to begin?

A: Those subsidies will be available in 2014.  Unfortunately, it will take that long for this program to get set up. If for some reason you have to drop your insurance because you can no longer afford the premium and you do not have coverage for at least 6 months, you will become eligible for the high risk pool – those details are not yet worked out so keep checking back. The bad part is you have to give up your insurance for 6 months which I would avoid doing at all costs.  Sit tight, although 2014 seems far away, it will get better.


Q: It was my understanding that when the health care reform bill was signed, dependent coverage of children up to age 26 would be effective immediately. Is this not true?  My employer says this is not so.  Please help I have a 21 year old daughter that I had to drop from my policy due to her age.

A: The legislation states it’s effective 6 months after the date the bill was signed into law – so the dependent coverage will start at the end of September – that being said, many employers have decided to start right now but that remains the employers options.




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