Ask Colleen King

All the questions you've had about health insurance, life insurance, annuities and long term care insurance (but were afraid to ask)

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CalPERS looking to raise premium on their long term care coverage 75%–why?

October 4th, 2012 by Colleen

On a good day, long term care insurance is not cheap but it can be reasonable for what you get if you get it when you’re younger. But in this article CalPERS is looking to potentially raise rates 75%? Is that reasonable, can they do that?

Yes they can do that–even though they offer a ‘Partnership’ plan. These offers asset protection for people who exhaust their policy then need to potentially qualify for MediCal, and have certain parameters in place especially around rate increases. But the CalPERS plan is exempt from this because they are what is referred to as ‘self funded.’

Normally one buys insurance (this applies to health insurance also) and the insurance company pays for care. When a long term care or health insurance plan is ‘self funded,’ that means there is a ‘check book’ figuratively speaking, and the plan sponsor, which in this case is CalPERS, pays the claims. The CalPERS plan has been closed to new enrollment for at least a couple of years now, so you have no new, young blood (or money) coming in.

So that’s why I urge my clients who are eligible under CalPERS to consider long term care insurance outside of the State’s plan. There are no restrictions on rate increases, there are other limitations in the duration of the of the plans offered, and it’s starting to look like there could be a sustainability problem. Ya think?

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What’s an insurance exchange?

August 21st, 2012 by Colleen

You may be hearing about this more and more in the news these days. Will they be of help to you? Here’s some info, with a bit of my ‘opinion.’

Health care reform proponents wanted to create a ‘marketplace’ where people could go to compare different types of coverage, get help figuring out what plan will work best for them. In the insurance agent community, we weren’t exactly sure what that meant, since wasn’t that we did already? Go to my web site, check out the plans, or call me and I’ll check some out and make suggestions, all without creating a new government agency.

There is still LOT to be done in establishing the exchanges as each state is to create one, or if they don’t want to, the federal government will do one. The biggest difference, is if you are eligible for a subsidy from the feds to purchase coverage, you can ONLY buy from the exchange. Agents in California supposedly are going to be able to offer plans through the exchange, but details on that will need to be worked out–like commissions.

There is a lot more to be figured out, like cost, what will the plans look like, which insurance carriers will be participating, and this needs to be created for both individual/family plans and small group plans. Will it help affordability? Not sure, that will take some time to figure out. And keep in mind, it all has to be up and running by January 1, 2014. Not very far off….

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Is the insurance plan for people with pre-existing conditions working?

February 23rd, 2012 by Colleen

Well, sort of. According to this terrific article by Allison Bell, the Pre-existing Condition Insurance Plan (PCIP) almost 49,000 more people in the US have coverage since starting in August 2010. But this plan, which is managed by the Federal Government, is having higher than expected claims.

Are you kidding me? The PCIP is for people who can’t get coverage on their own or don’t have it available at their job. The people with more mild conditions are going to sign up for this necessarily, just like anything else. So that leaves you with sicker folks who are absolutely going to use it. And their claims are averaging $29,000 per year.

The state based major risk plans according to this article don’t require people to wait before enrolling–in California though there is a 3 month wait for the MRMIP Major Risk plan. On the Federal PCIP, one has to be uninsured for 6 months before being eligible. And it really is a great plan, no question. But really, with the economy the way it is, most people are waiting until the qualify, and if they have a condition that can be treated and and cured, they drop off the plan as soon as they can. This way of thinking is why in health care reform, if you are going to require insurance carriers to issue plans regardless of health status, there has to be some kind of requirement to purchase. Otherwise, you aren’t looking for insurance, you’re looking for financing. And that’s not what insurance companies do.

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Expensive health care, mediocre results–really?

November 30th, 2011 by Colleen

While Americans continue to brag about their marvelous levels of care, well at least some Americans, our quality apparently isn’t up to snuff.

Life expectancies, hospitalization rates, cost of care, we’re trailing on an international level. America rates well in cancer care though, according to this article. Switzerland’s system is touted as being effective, and significantly reduced cost, but scroll down to the comments and you will see that while they do have a private insurance system, reimbursement for care and insurance rates are highly regulated. Payments are based on a fee schedule. Take 2 minutes and read this article I found on California Healthline, and you’ll find some interesting statistics on the costs involved with health.

Also interesting is how lack of access is cited as a big problem in the US, not obesity, smoking, etc., the usual suspects.

So what do you think?

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What? The plan for ‘uninsurables’ is filling up? What now?

November 29th, 2011 by Colleen

Geez, now this is a drag–the Pre-existing Condition Insurance Plan (PCIP) which was supposed to be such a panacea for the uninsurable apparently was too popular–in 2 months, the program might be stopping enrollment because, get this–the claim costs were 3 times higher than anticipated. Big surprise!

You have to realize that when you offer something like this, the more desperate people are, the sicker they are, the quicker they will be in line to enroll. The rates on California’s PCIP are really good, and it’s a very rich plan by most peoples’ standards. Combine all of this and it explains why claim expenses ended up being so much higher than anticipated. Read this article from the California Healthline to better understand the problem.

This is only the beginning folks–if government can’t estimate the costs for a relatively small population, how are they going to do it for an entire country?

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Health care reform and the role of the local broker–more important than ever?

November 2nd, 2011 by Colleen

Well, okay so your broker doesn’t have to be physically down the street, but it’s looking more and more like getting some help in sorting out options from someone when shopping for health insurance, available to you at no cost, makes sense.

Several articles talk about rates had shooting up and and people looking for new coverage. Often people found working with an independent broker helped find something manageable. You can go to the big major online sites but honestly, the past few years, I’ve helped people change plans several times after they bought something online then found it didn’t work the way they expected.

The California Small Business Association (CSBA) which I’m a member of has a program titled Buy California Small Business First which is aimed at drawing attention to doing business with people and companies within California. The reason to do this is to keep more money/revenue in the state; it’s not necessarily more expensive to do business with local smaller stores.  Now obviously not all insurance companies are based within California, but the local broker is. You will most of the time end up with more personal service when working with a broker. And if you don’t, then you need to look elsewhere; there are thousands of us.

The point is with health care reform in full bloom, there is way too much to keep track of and relying on your broker to help you where needed can be a real plus. Rate increases are hitting–we don’t have all the information yet like we have in years past but do you want to sit on hold with Anthem Blue Cross or Aetna for 20-30 minutes? I’m already doing it, so just add you question to my list. It’s all about trying to save clients money on their health care coverage where we can while making sure as close as we can that your needs are met–that what we do.

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Health care reform made all preventive care free, right?

September 23rd, 2011 by Colleen

In the effort to increase access to care the Patient Protection and Affordable Care Act (PPACA) mandated that preventive services be covered on newly developed plans with no share of cost and before a deductible is met.

Or so we thought–Check out this article from the US Department of Labor. One thing that was not really mentioned is where you go for services may determine whether or not there is a sharing of cost or not. The example here is that if you go to a free standing, ambulatory surgery center for a colonosopy, you probably won’t have a co-pay. But if you go to the outpatient department of a hospital, you probably will because cost of care at those types of facilities typically is higher.

So that’s why I call this the asterisk, or the footnote, yet another, in health care reform. The bill was passed with little detail really delineated, just a ton of concepts. So my advice So Cal, is if you have to have anything more complex than a blood test, so you minimize your costs call the member services number on the back of your insurance card. We have a lot of free standing ambulatory surgery centers in Los Angeles, and a lot of hospitals. Make sure you find your most cost effective options! Money’s still not growing on trees, at least not in the San Fernando Valley.

Have a great weekend!.

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Medicare and the Annual Election Period–it’s early this year

September 17th, 2011 by Colleen

Every year about this time you start to see commercials about the various Medicare HMOs and Part D drug plans. Then around November 15th, the true onslaught starts.

This year the onslaught will come early. The Annual Election Period (AEP) will be from October 15 through December 7. This is the time you can change your Medicare Advantage plan or Part D drug plan for the year 2012. This is one of the few good things that has hit with the Affordable Care Act.

The reason this is good is that any changes made are effective January 1 for the coming year. Previously, the AEP was November 15 to December 31. Needless to say if you were working with clients that last week of December, as most of us were, things were not up and running January 1. I actually drove out on December 31st to meet a new client, do her paperwork and fax it in so it would get there before midnight and January 1. So if you needed a prescription or a doctor visit, or god forbid hospitalization the first 2-3 weeks of January, it was chaos.

I’ll be writing more about this in the next couple of weeks, but officially, we can’t start ‘marketing’ until October 1. I’m just giving you a heads up in case you or someone you know may want to make changes. This is your “once a year “opportunity!

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Who has the most expensive health insurance premiums for individual plans in the country?

August 17th, 2011 by Colleen

In dealing with people day to day, most think California has to be the most expensive state in the nation. Not so, believe it or not, it could be worse.

Health care reform, the Patient Protection and Affordable Care Act (PPACA) were suppose to get us on the road to more affordable health insurance. Notice I didn’t say health CARE. The PPACA did not deal with health care costs at all, just health INSURANCE costs. But I digress…..According to, California is 9th in ranking least to most expensive. There’s a foot note, as usually with California, that HMO plans were not factored in to this and according to this 2010 data this takes all plans, all ages so of course there will be some radical deviations. But I still thought it was interesting.

The national average is $215/month. California comes in at $157/month. Check out this list, and notice who comes in at the end.  Massachusetts, where coverage is required. New York and New Jersey are pretty darn bad too. This is why we have to be very careful of what we ask for, and how we implement it, because we just might get it.

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“How fast can you get me health insurance?”

August 15th, 2011 by Colleen

When a call starts like this, it’s rarely good. This usually means someone has something wrong, or someone’s pregnant.

Problem is, the intent of Health Insurance is in case something goes wrong. If something has happened, you don’t need insurance, you need financing and insurance companies don’t do that. This whole idea is why requiring people to buy insurance unfortunately is going to be important if health care reform is going to work. Otherwise, what will happen is people will only apply when they have an issue, then drop coverage when all’s well. The concept of insurance, all types of insurance, is that people have to pay in whether they need it or not then there is money in the risk pool for when something is needed. And a risk pool is never something you want to be in the shallow end of, that’s for sure.

That’s an issue that has come up with ‘child only’ plans. Under age 19, due to health care reform, all kids have to be accepted regardless of pre-existing conditions. They can be charged above standard rates, but the carriers have to take them. One thing that is starting to happen is carriers are putting a 15 day delay in place from the time an application is submitted to when it can become effective, to avoid this jumping in, jumping out thing. At first carriers said okay,we just won’t write any ‘child only’ policies, we don’t know the risk. California then passed legislation saying okay fine, you don’t write ‘child only’ policies, you don’t write any individual health plans in California for 5 years. More on this in another article.

My main point is, we can’t close the barn door after the horse is out, so that’s why you need health insurance. Before something happens!

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