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10-11-2010by Colleen King
Hello LA, I’m back from vacation and certainly while I was gone there were a lot of things going on in health care reform
In Friday’s Los Angeles Times there was an AP article about a federal judge in Detroit who ruled against a challenge contesting the legality of the Federal government requiring people to buy health insurance. According to U.S. District Judge George Caram Steeh in Detroit, the ‘mandate to purchase’ is legal. Or as the paper said, ‘is not illegal’–when it comes to things like this, there could be a difference, you never know.
The point is, we are already seeing the impact of ‘mandate to issue’ coverage to kids under age 19 regardless or pre-existing conditions. (Click here for details.) Most of the major carriers in California are no longer issuing ‘child only’ policies. You can add your kids to your group coverage or your family’s health policy but the rates are starting to pop. Common sense will tell most of us, if the carriers have to issue coverage to ‘all,’ who are the first people going to be in line to get it? Sick folks, folks with problems, that should not come as a surprise. And if everyone is not required to buy, people will tend to buy only when they need it then drop it when all’s well. That isn’t going to work financially.
I’d like to convince people that everyone should have coverage as a means of making the overall concept work, and protect themselves financially but most would probably think I’m only looking for the next sale. But the reality is, this reform is only going to work if everyone’s in the pool, so to speak. And don’t think this will be the last court challenge, there are already several in the works and it’s only getting started.
There’s a case being heard in a Florida court that’s been filed by 20 states, and another one in Virginia. So stay tuned, because whatever happens it will affect us at some point in So Cal.
Have a great week!...read more
08-27-2010by Colleen King
Some people think they have to have a long term care insurance (LTCi) policy that covers everything for many years. Often people want to look at a ‘lifetime’ benefit, maximum daily or monthly benefit amounts, and a few other things to minimize their out of pocket expenses when care is needed. But then they get the quote and it’s astronomical, perpetuating the idea that LTCi is too expensive.
But do you need all that coverage? You need to know that LTCi, like health insurance, is not intended to pay 100% of the cost. It’s intended to cover a majority of the expenses though. Here are a few tips around the pieces of a long term care policy to consider to make it more affordable:
Benefit Period–people frequently want lifetime benefits but the reality is once someone is receiving custodial, nursing home or assisted living care, the average length of time care is needed is about 2 1/2 years. We’re not talking about something simple you need help for a few weeks then you’re fine. We’re talking generally older people closer to the end of life. And now, some carriers don’t even offer a lifetime period. I usually start with clients by looking at a 3 year benefit period. If they can afford it and they want it, we may go to a 4 or 5 year period, or cut it back to 2 years. Remember, Medicare will pay for a limited amount of skilled nursing care only. And who knows, that may change at some point the way things are going.
Elimination Period–Some people also refer to this as a ‘time deductible.’ This is the period of time that you actually need care before your policy kicks in. My starting point is 90 days. The reason is that if you need skilled care, Medicare or your private insurance will cover usually about 100 days. If you need home custodial care, it’s possible to add an inexpensive rider that will give a zero day elimination period for home care. Depending on your finances, you might want to stretch out the elimination period to 180 days.
Inflation protection riders–You most likely will want this in some form. The inflation protection piece makes your daily benefit amount increase a certain percent on the anniversary date of the policy each year. Ideally, especially if you are younger, you should really consider a compound interest rider. This is usually less expensive than starting with a significantly higher daily benefit amount. If you are a bit older, you might be able to get away with a simple interest inflation protection rider, because in that scenario starting with a higher daily amount and simple interest could be less expensive than a comparable policy with compound interest.
Different insurance companies offer different combinations in elimination periods, different riders, benefit periods, all sorts of things. So if the first quote you get sounds ridiculous, ask questions, either of the agent you are working with or ask another for information. Because the government isn’t going to take care of this, and you probably don’t want to saddle your kids with your care....read more
08-19-2010by Colleen King
The word is out–according to Alison Bell of the National Underwriter web site insurance commissioners in several states, including California (Thanks Mr. Poizner!) have come out with a resolution urging keeping a role for the independent agent as the PPACA (aka health care reform) moves forward. Check this short article out.
Makes sense if you think about it. People generally don’t understand health insurance now, and every other day there are new things coming to light with the new health care reform bill. Someone needs to explain it and help people make decisions. So does it make sense to create another government bureaucracy from scratch, hire all those people who require desk space and benefits? Or go with the independent agent structure where we don’t make anything unless we do something for someone. And no one has to give us benefits necessarily.
Of course I’m biased as an agent. I have a business that fits well with the So Cal lifestyle. I can work 6 hours a day, or 12 as needed. As new employer regulations come in, employers are going to need a resource still. Someone that will go to bat for them when there’s a problem, because they are running their own business. And everyone needs help decoding their explanations of benefits.
Between massive egg recalls and Dr. Laura quitting radio, there’s just TOO much to keep track of! You’ll want to keep us around….....read more
08-11-2010by Colleen King
One of the big things that was to be emphasized by the Patient Protection and Affordable Care Act (PPACA) was removing cost barriers to many preventive services.
July 14th the announcement was made by the White House as to what those services are–click here for what is the current comprehensive list:
These services as of September 23, 2010 are to be covered without ‘cost sharing’–before the deductible has been met; no co-pays, no co-insurance. But predominantly on ‘new’ plans. Some of the existing plans will adopt these provisions.
So is this a good thing? People can’t afford to pay for these services so they don’t obtain them in theory. My biggest concern is that we are about to see the ‘Affordable’ go out of the Affordable Care Act. Think about it–these are not ‘free’ services, since someone is going to want to be paid to do them. They are free to you, but they aren’t free.
I’m not being a grinch about this, just a realist. Insurance carriers are going to have to pay someone to do these. And someone’s going to have to pay the insurance companies. Three guesses who that is…..
So IF you have preventive services you need done, check the list above. If you can wait, you might save some money if you do them after September. IF your plan works that way. IF they’re a covered service. IF there isn’t some other question that didn’t get answered on the White House call yesterday.
Don’t want to be a downer, but there are SO many questions that haven’t even been asked yet, let alone answered, just please tread carefully. And stay tuned....read more
08-10-2010by Colleen King
Remember the old phrase ‘be careful what you ask for, you just might get it?’ Well, Anthem Blue Cross put out an email yesterday to agents advising us that due to the new changes resulting from the Patient Protection and Affordable Care Act (PPACA), also known as health care reform, if you are looking for an individual plan with them you have until September 22. After that, they will have to update their plans, their software (and presumably our software, those of us who have their own quoting sites) with the new plans and rates that will be effective September 23.
Now, before you go as nuts as a Jet Blue flight attendant (gotta love that guy!) think about doing something sooner rather than later. Right now, we know what the plans are and we know what the rates are. Anthem currently offers a 12 month rate guarantee, so whatever you enroll in now, you will maintain that rate for 12 months. Since we don’t know what is coming, I’d vote for a bird in the hand.
Carriers are going to be required to include certain benefits and that will probably raise rates. And it’s not only going to be Anthem, all carriers are most likely going to be doing something in order to comply with the new law. This is just the first we are really hearing about it. Why am I fairly sure rates will go up? Two things in particular–people under age 19 will no longer have pre-existing conditions held against them, and there will no longer be annual or life time maximums allowed on plans. The latter frankly won’t have a huge affect overall. Most plans in California have anywhere from a $3-$7 million life time maximum, which the vast majority of us will never come near. But, it will be a reason to increase rates in anticipation. The scarier part will be what happens when they have to take all applicants.
Basically, this is just the beginning of sweeping change. We’re trying to keep up, but since so much of this was not worked out at the time the bills were passed, and still hasn’t been, it’s time to hang tight and hope for the best.
A light humorous look at health care reform...read more