Colorado Health Insurance Insider

We've Moved

2006-09-07T15:13:00.000-06:00

The news and ideas haven't stopped, starting on September 7, 2006 you can find the Colorado Health Insurance Insider here... http://www.healthinsurancecolorado.net/blog1/. With more tools, we think you'll like the new location much better.

Skeptical about Aetna

2006-09-06T18:09:00.000-06:00

After a five-year hiatus, insurance heavyweight Aetna Inc. has returned to Colorado's small-group health insurance market.
The insurer has been meeting with brokers and already has sold plans with a Sept. 1 effective date. The company is offering 13 plans for small employers, including two high-deductible plans that are compatible with health savings accounts.
In 2001, Aetna announced it was pulling out of Colorado, saying it couldn't turn a profit on its plans for small businesses.
It dealt a huge blow to the state's small-group market, which includes self-employed individuals and groups of two to 50 people. In 2000, Aetna's was the state's second-largest small-group carrier, and the move affected about 100,000 members, who had to either find new coverage or go without it.
Bill Berenson, Aetna's regional head of sales, based in Chicago, said the company is "completely different" than it was five years ago. It has a new management team and a better understanding of which products are profitable, an understanding it lacked five years ago.
Aetna grew rapidly before it pulled out of Colorado's small-group market -- from fewer than 30,000 members in 1999 to more than 100,000 in 2001. Aetna's plans for small employers were the cheapest in Colorado. But the prices were so low, the insurer couldn't turn a profit.

Of course, we will include them in our comparisons for our small business clients to get an idea of what their options are. When people are given this information and are aware that the company has recently pulled out of Colorado, about half will still decide to take the risk if the price is right.

But Aetna's return to Colorado comes as the state's small-group market has been shrinking. The number of people getting health insurance through Colorado's small-group market dropped for the fifth year in a row in 2005, according to the Colorado Division of Insurance. Last year, there were 358,264 employees and dependents covered in small groups, compared with 456,151 in 2001. That's a 27 percent decrease.

Irresponsible?

2006-09-05T11:41:00.000-06:00

An article in the Denver Post yesterday talked about the number of people age 19 to 29 without health insurance.

As snowboarding season approaches, so does the time of year when Katie Neal's mom really freaks out.
What bothers her mom, Neal said, is not the speed at which the 26-year-old slashes through powder.
It's that she does it without health insurance.
Nationwide, about 13.7 million people ages 19 to 29 didn't have insurance in 2004, making them the largest group of uninsured adults in the country, according to a report by the Commonwealth Fund, a nonprofit health- research foundation.
That is true in Colorado as well, according to the Colorado Health Institute.
Young adults 19 to 29 make up 17 percent of the population but account for 30 percent of those younger than 65 who don't have health insurance, Commonwealth Fund noted in its report, "Rite of Passage? Why Young Adults Become Uninsured and How New Policies Can Help."
Neal, a server at Governor's Park tavern, knows she's not invincible.
Neal's employer does offer insurance. She just can't afford it.
"I would like to have it," Neal said.
At about $200 a month, health insurance would eat up about a quarter of Neal's monthly income.
"I'm working my way out of debt, and having another bill, I just can't do that," she said.

I'm also a snowboarder. When I graduated from college and didn't have any money, snowboarding was a lower priority than health insurance. I missed several years of it and got a bit rusty, but I didn't risk having tens of thousands more in debt from an unpaid hospital bill.

For $96/month, Neal could get a $5,000 deductible / 100% coinsurance policy from Tonik, or she could pay $77.43/month for a $5,000 deductible plan from Rocky Mountain Health Plans - like they talk about in the article.

The best deal on lift tickets in Colorado is the Buddy Pass (unlimited to Keystone, Arapahoe Basin, and Breckenridge) for $349. She might have gotten a used snowboard/bindings for around $300, and another couple hundred for gear (coat, pants, socks, gloves, etc).

There are examples out there of people who can't afford health insurance yet make too much to qualify for medicaid. But there are far too many examples of people who can afford health insurance, yet have their priorities mixed up. As Bob Vineyard from InsureBlog pointed out in today's post:

According to U.S. Census Bureau data released Monday, Americans with annual incomes between $50,000 and $75,000 per year saw the biggest increase in uninsured rates, up to 8.3 million, an increase of 600,000 people. 800,000 more people with annual incomes of over $75,000 are now uninsured.

Why are more and more people making health insurance less of a priority? If health insurance isn't mandatory, what could make it more of a priority than the consequences of not having it?

Mergers Limiting Choice - Part III

2006-09-01T16:11:00.000-06:00

In a follow up to this post about United Healthcare and HCA (HealthOne): to date, UnitedHealthcare and HCA (HealthOne) have been unable to reach an agreement in Colorado. Effective September 1, 2006, hospitals and surgery centers owned by HCA (HealthOne) are considered out-of-network. As always, emergency services will not be considered out-ofnetwork. Some physicians and other medical providers who were network members through the HCA (HealthOne) system may also no longer be in the network. You should check with your provider before your next visit.

Boulder County Kaiser Permanente Announcement

2006-09-01T15:59:00.000-06:00

If you have an employer group plan from Kaiser Permanente and have the Triple Option Point of Service plans and PPO plans in Boulder County, Colorado, there are some very important changes.

PHCS Network Changes:
Boulder Community Hospital and the Boulder Valley IPA, participating/preferred providers for Added Choice Triple Option and PPO members, notified Private Health Care Systems (PHCS) that effective Sept. 1, 2006 they would no longer be a participating provider for Kaiser Permanente Added Choice Triple Option and PPO members. This includes the following facilities:
a. Boulder Community Hospital
b. Boulder Medical Center
c. Boulder Ambulatory Surgery Center
d. Community Medical Center
e. Community Reference Laboratory
f. Mapleton Center for Rehabilitation Services
g. Mapleton Center for Rehabilitation Services-Longmont,
h. Mapleton Behavioral Health Services,
i. Miriam R Hart Regional Radiation Therapy Center,
j. Boulder Community Homecare,
k. Boulder Center for Sports Medicine
l. Therapy Clinic at Gunbarrel
m. Endoscopy Center of the Rockies.

Kaiser is actively working with Boulder Community Hospital and Boulder Valley IPA to reach an agreement as late as August 30th. Kaiser Permanente is committed to providing high quality, affordable care to the residents of Boulder County and Boulder Valley. Kaiser Permanente continues to have a network of participating/preferred providers in Boulder County and Boulder Valley available to our Added Choice Triple Option and PPO members. This network includes hospital and physician providers.

Kaiser Permanente will support members in the transition of care by continuing to cover all services received from these providers as Tier 2 Participating providers for Added Choice Triple Option plans and In-Network Preferred providers for PPO plans through November 30, 2006. Any member in the third trimester of pregnancy will be covered for services received through delivery. After November 30, 2006, Kaiser Permanente Added Choice Triple Option and PPO members can continue to access Boulder Community Hospital and Boulder Valley IPA providers however out-of-network charges will apply.

A letter is being mailed to all employer groups with members enrolled in the Added Choice Triple Option and PPO plans to inform them of this important change and Kaiser Permanente’s transition of care plan. In addition, PPO and POS members will be receiving a letter to inform them of this important change.

Smaller Check, Higher Deductible

2006-08-30T21:23:00.000-06:00

The median income in Colorado has fallen while the number of people without health insurance in the state remained flat, according to a U.S. Census Bureau study released Tuesday.
The Census Bureau said the median household income fell from $52,729 (a two-year average for 2003-04) to $51,518 (a two-year average for 2004-05).
For the three-year average median household income, covering 2003-05, Colorado's $52,011 put it 11th in the nation.
Meanwhile, the Census Bureau said the number of people without health insurance coverage in Colorado stood at 16.9 percent of the population for 2003-04 and 16.8 percent for 2004-05.
The national average for 2004-05 was 15.7 percent.

Colorado residents are now covering more of their healthcare costs with less money.

Colorado Uninsured Rising

2006-08-30T21:05:00.000-06:00

The portion of Coloradans with employment-based health insurance has dropped 7 percent in five years as rising health-care costs push insurance policies out of reach.
The portion of the workforce under 65 covered by work-based insurance fell to 64 percent in 2005, according to a U.S. Census study released Tuesday.
The Denver Post reports: The total number of Colorado residents without insurance reached an all-time high of 788,000, or 17 percent of the state's population, the study said.
Driving the insurance decline is a 10 percent annual increase in medical costs, according to Dr. Gary VanderArk, president of the Colorado Coalition for the Medically Underserved.
"Employees are expected to pick up bigger and bigger co-pays and bigger deductibles, and it drives some out," he said.
Some employers are either not offering insurance or cutting back on benefits, said Carrie Curtiss, associate director of the Colorado Consumer Health Initiative.

As health care costs continue to increase; employers are covering less and less and employees essentially end up with a smaller income.

Undoing the Misconception

2006-08-30T13:57:00.000-06:00

I was recently talking to a client that was coming off a plan through her job. She was offered COBRA, but it was obviously really expensive. She mentioned that she gets a prescription for a depression medication that costs around $150 per month retail. I explained that because we are looking at underwritten plans, none of the companies will cover anything to do with depression; including the medications.

When we started looking at some different options, she asked a very common question: "If they aren't going to cover my depression meds, then I don't need a plan that covers prescription drugs, right?"
I then reminded her that she isn't getting the insurance to cover what she already needs. Because if she were to get a disease that required $1,000 to $1,500 per month of prescription drugs, she would be in serious trouble. And if she were to get a plan that were to cover her pre-existing condition (like her COBRA), it would cost her more than it would to get an individual plan and pay for the medication herself.

She understood the situation very quickly, and was then asking about how HSA qualified plans could help her save even more. This is usually a hard situation for people to understand, especially people who have always been on group plans, where the employer paid most of their premiums and the insurance never asked about pre-existing conditions. I felt lucky that she understood so quickly because most people get angry and call health insurance a "crock"; and say "what am I paying all that money for if it won't cover what I need it to?"

At this point, I sometimes wish I could be a P&C agent (someone who sells home and auto insurance). I wonder how many times people call Geico looking for a car insurance quote on their recently wrecked car; and explode when they are told that the insurance won't pay for damage that was there before the policy was purchased?

Cavalcade of Risk

2006-08-30T09:58:00.000-06:00

Kristin McAllister, who writes a blog about personal finance in the Dayton Daily News has put together the latest edition of Cavalcade of Risk. Personal finance enthusiasts will find plenty of good reading on this page with the two sections: Risky Business and The Secret of My Success. The page has an easy to read layout so you can browse the articles and check out only what you're interested in. You can peruse Cavalcade #7 here. If you enjoy reading it, let Kristin know.

By the way, we're hosting the next one at our new blog "spot", http://www.insuranceshoppers.net/blog1/.

Failure To Launch

2006-08-29T15:53:00.000-06:00

In a new move to lower the number of uninsured in Arizona, Blue Cross Blue Shield has decided to allow parents to cover dependents until they turn 30 on individual, under 65 plans. As long as they aren't married they can be covered, whether they live with their parents or not and they aren't required to be students.

According to AZcentral.com:

Blue Cross researchers found that 19- to 29-year-olds in Arizona were more likely than the general population to be uninsured. Yet 75 percent of the young uninsured said they considered health insurance "very important."

This won't lower the price by much because individual/family plans charge per person. But it is likely to keep some "kids" insured at a point when they don't really have their priorities in line yet. In Colorado, Anthem Blue Cross Blue Shield has introduced Tonik, which is aimed at the high rate of uninsured in the 19-29 year old age bracket. Tonik is more attractive to this age group with lower rates, and dental and vision coverage; but lacks brand name prescription drug coverage, which is a low risk for this age group anyway.

Colorado law says that a person up to 25 years old can be considered a dependent if they are unmarried. Most Colorado health insurance companies also require that dependents over the age of 19 be full time students.

Democrat, Republican, Big Box Mart

2006-08-29T11:57:00.000-06:00

Wal-Mart, under attack now from unions and prominent Democrats, yesterday introduced a marketing campaign that closely resembles the television advertisements used by political candidates.
The ads, running in Omaha and Tucson, underscore Wal-Mart’s transformation over the last several years from an insular company obsessed with low prices and technological efficiency to one that openly acknowledges its public relations troubles and has introduced numerous programs to counter them.
In the last year, the company has expanded health care coverage to the children of part-time workers, has committed to sweeping reductions in energy use and has promised to work with competing retailers in urban areas where it builds stores.
Later, the narrator ticks off a list of Wal-Mart’s benefits: “Last year alone, Wal-Mart created tens of thousands of new American jobs — many in areas where they’re needed most. And we offer eligible associates health insurance for less than a dollar a day.”

It looks like the negative attention they've received in the past has had an effect. They've beefed up their health insurance benefits a ton. This should be important to everybody because we'll all be working for Wal-Mart one day :)

I Want a "Group" Insurance Rate

2006-08-28T20:12:00.000-06:00

I get calls all of the time from people on the search for a better health insurance rate and they ask me how they can qualify as a "group". The usual one I hear is that they are self-employed and their wife helps them with the books, so they want a "business group" plan. I once got a call from a guy representing a large group of independent musicians from all over Colorado and they wanted to band together into a group for health insurance reasons.

While there are several ways we can find people a "group" rate on health insurance, it's usually the worst option available. In Colorado, if you're self-employed you can typically get a Business Group of One (BGO1) policy for just yourself without even having other people in your group. The problem is that Colorado law (as well as most other states) says that group health insurance cannot be underwritten. Even better right? Well, policies that are underwritten are normally 1/2 to 1/3 of the cost of non-underwritten policies. This is because they don't have the extra expense of having to cover pre-existing conditions. Not only do they not cover pre-existing conditions like asthma, but they can completely decline people with more serious health conditions. This dramatically lowers the cost structure.

It's not uncommon that I'll meet someone who bought their first health insurance policy as a self-employed person without the help of a health insurance broker or they bought it from their P&C agent. They are a perfectly healthy person on a self-employed BGO1 policy paying nearly 3 times as much as they need to be for their policy. All because they are self-employed, so they figured they needed a group rate policy for self-employed people.

If you're ever in a situation where you need to buy your own insurance (because you're self employed or your job doesn't cover it) and you have a pre-existing condition that prevents you from getting an underwritten individual/family policy, CoverColorado may be able to help. Colorado is just one of many states that has a risk pool. If you are a self-employed individual needing coverage only for yourself, a BGO1 will probably work well. But if you have dependants, and you or one of your family members needs a guaranteed issue policy because of a serious pre-existing condition, the most cost-effective solution may be to put that person on a CoverColorado policy, and get an underwritten policy to cover the rest of the family. That way you're only paying the guaranteed issue "group" price for the person who needs it, rather than the whole family.

Definition of Insurance - Part II

2006-08-28T19:41:00.000-06:00

To further the definition of insurance beyond Louise's post, insurance implies that you're taking some sort of risk. And "losses [or gains] must be uncertain" according an official definition of insurance. In some interesting comments to a post on insureblog, I took part in a further discussion of the definition of insurance. It's very interesting - check it out.

There are many other variables that need to be changed in healthcare, like usage. As Louise and Justin from HealthFlux pointed out, people shouldn't be expecting their health insurance to provide constant use - like a car, or a house, or food. The real problem is trying to educate people that health insurance is different. I try to point out that health insurance should be looked at like home or auto insurance. But when people disagree, what are the best ways to do that without sounding preachy and providing them with good service?

Definition of Insurance

2006-08-26T10:45:00.000-06:00

Perhaps one of the problems contributing to the rising cost of health insurance stems from the fact that many people have lost sight of the meaning of insurance. When you ask someone what's important to them about their insurance, you'll often hear things like 'good preventative care benefits' or 'low copays for office visits and prescriptions' or 'low deductible.' When we remind people that they'll save a lot of money on premiums by selecting a higher deductible with less coverage for the day-to-day expenses, they often respond by saying something like "what's the point of having insurance at all if you're still going to be paying for all your own doctor visits?" Or they'll say "Well, I never have $2000 worth of medical expenses in a year, so with a deductible that high, it wouldn't even be worth having insurance." The problem with this logic is that people are thinking of insurance premiums as direct payment for an equal-value service. When you buy a car, if you pay $10,000, you can expect to end up with a car valued at $10,000. Insurance is a totally different commodity. You're paying premiums for an intangible benefit, ie. the peace of mind of knowing that if you ever do have a health crisis, it won't leave you bankrupt. Insurance is an aleatory contract, which by definition means 'depending on an uncertain event or contingency as to both profit and loss.' This is why you can pay relatively low premiums compared with the potential benefit - because both you and the insurance company know that the likelihood of you needing the benefit is low.
So in order for insurance to work as it was designed, you have to be willing to buy a policy hoping that you'll never have to use it, and knowing that the premiums you pay will only give you a tangible benefit in the unlikely event that you have a serious illness or injury. The intangible benefit, being able to sleep at night because you know you have an insurance safety net in place, is the one that brings you daily peace of mind.
When people start to expect insurance carriers to cover expenses that they know they'll be incurring (ie, maternity, preventative care, etc.), insurance begins to lose its aleatory nature. It then becomes a tangible product, in that people are paying premiums and fully expecting to realize short-term monetary benefits. Insurance companies are generally for-profit entities. So you know they aren't giving consumers anything for free. If we are buying insurance and fully expecting it to cover planned events, we have to recognize that the cost of those services is included in our premiums.

Making Health Insurance Mandatory

2006-08-25T15:24:00.000-06:00

There are currently about 41 million Americans without health insurance. Uninsured people are less likely to seek treatment for medical issues, are more likely to die as a result of treatable health problems, and are more likely to use the ER instead of a physician's office when a problem does arise (often because the patient did not seek treatment when the problem first arose, and it subsequently got worse).
Almost every state in the US requires drivers to carry automobile liability insurance. Yet there are no government mandates requiring citizens to have basic, catastrophic health insurance coverage. In the case of liability auto insurance, it makes sense to require that all drivers be insured. That way, if you run into someone else, and you're at fault, your insurance company will compensate the victim for their loss. However, it is not mandatory to have comprehensive/collision insurance on your own vehicle (unless you have a car loan, then the lender can require it, but it's not a government regulation). This is because you can choose what you want to do with your own vehicle, and if you would rather take the risk of losing it in an accident, you can. Some people might say this is the same as health insurance, ie. it's your health, so if you don't want to insure it, you don't have to. I disagree. The problem with this logic rests in the fact that our society does take care of people in a life or limb health emergency, and payment issues come later (as it should be). If you are in a bad accident and transported to the ER, you will be admitted and treated to stablize your condition before payment issues arise. This is the only humane way to handle health crisis situations, but it leads to a problem if the patient is uninsured. If the patient is unable to pay his or her medical bills, the costs are passed on from the hospital to paying patients and insurance companies. This is part of the reason that health care and insurance costs are so high - someone still has to pay for the services provided to people without insurance or a means to pay their medical bills.
I believe that basic medical insurance should be mandatory, and proof should be required, perhaps in order to obtain or renew a driver's license. This could be a government program, or could continue to be through private insurers. Medicaid is available to the lowest-income sector of the population, and the rest of us could choose high-deductible, no-frills coverage to get us through an emergency. If everyone were paying into the insurance system, perhaps each person's premiums would be lower, since the cost of providing medical services to Americans would be spread more evenly over the whole population, rather than falling only to the insured members.

Slowly Removing Prescription Coverage

2006-08-24T17:27:00.000-06:00

I was at a meeting for Anthem Blue Cross Blue Shield today and they were going over their new BeneFits small group plan and the new RightPlan PPO 40. They pointed out that ~50% of the 225,000 small group employers in Colorado are uninsured, so that makes about 110,000 uninsured small businesses. In 2002, there were 1.3 million uninsured people in Colorado (about 33% of the population).
The main thing I noticed about these plans was that the BeneFits plans had no brand name Rx coverage and the RightPlan PPO 40 had it as an option. These type of plans are a great way to possibly lower the price enough to make a big dent in the uninsured population of Colorado. I think Anthem has done a great job of designing plans like this so brokers will have more options to give people who might otherwise not be able to afford anything.
All of the carriers in Colorado are coming out with plans like this. Of the bigger names; United HealthCare has the Saver plans that don't cover Rx at all, most of Celtic's plans only have brand name Rx as an option now, Kaiser Permanente offers 5 plans and only 1 of them (the 100% HSA) covers Rx at all. Humana is the only company with all of their plans covering full prescriptions. But I hear they are working on a plan to compete with Tonik (from Blue Cross), which doesn't cover brand name Rx either.
On the surface, it seems like a great way to offer more options to lower the uninsured numbers. But when these plans become more common and having Rx coverage is seen as an unnecissary luxury, what then?

Correction -- the number of uninsured in Colorado at any given time is around 700,000; or 18.1% of the population. (Source)

Financial Exposure

2006-08-23T11:11:00.000-06:00

Your financial exposure is what your wallet (financial) would lose (exposure) if you have a catastrophic medical situation. The reason for health insurance is to minimize your financial exposure, because without health insurance your financial exposure is everything. A lot of people think it's best to have the lowest financial exposure you can get and request the lowest deductible possible.

A deductible is something you'll only need to pay if you have a big claim. However, your premium is something you need to pay no matter what, just to keep the insurance. Just for an easy example, we'll say that a 50 year old male is looking for a policy from Anthem Blue Cross Blue Shield of Colorado (we'll call him Larry). Larry requests a $500 deductible with $25 copays for doctors visits, $15/$40/$60 copays on Rx, and an 80/20 coinsurance with a $5,000 maximum. Right now, this would cost Larry $338.50 per month. This would give Larry a maximum financial exposure of ($500 deductible + $1,000 coinsurance + $4,062/year in premiums) = $5,562 per year plus copays if he had a catastrophic event.
As a good broker, I try to help Larry by pointing out that he can get the same exact plan with a $1,000 deductible for $291.70. This would save him ($46.80/month x 12) $561.60 per year in premiums, and give him a maximum financial exposure of ($1,000 deductible + $1,000 coinsurance + $3500.40/year in premiums) = $5,500.40 per year plus copays if he had a catastrophic event.
So in a worse case scenario, Larry would still save $61.60/year by having the higher deductible if he had a big claim every year. But in a year where he doesn't have something happen, he would save $561.60. Either way, he comes out ahead with the higher deductible. Sometimes I'll talk to people so entrenched with the idea of having a low deductible that they still choose the lower deductible when I give them an example like this. Usually, it's because they're just coming off of a group plan that had a low deductible and have it in their heads that they need to get a comparable individual/family policy.

This example is just the beginning, I'll go over the logic in choosing an HSA later.

MEGA Insurance and NASE

2006-08-22T08:43:00.001-06:00

Here is a great way to sell health insurance to overwhelmed newly self-employed people: Start up a cover association with a name like "National Association for the Self Employed" or "Alliance for Affordable Services", so people will think they're getting a great "group" benefit. And recruit naive, new agents by the truckload so they won't know what they're selling.
That's just the beginning. When I first started in the health insurance industry, I worked for MEGA. They recruited about 20 new agents per week; none of us had a clue about health insurance yet. They brainwash the recruits by having mandatory weekly meetings where they bash PPO and HMO plans. After a while, I started to catch on and do my own research into the details of all the plans.
This post was mainly to warn any people that have just become self-employed. With all the things that need to be done when starting your own business, it's too much of a whirlwind and health insurance doesn't get the time it deserves. To keep it short, Colorado, like most states, requires that group health insurance not be underwritten on an individual basis. This may sound great at first, but a healthy person is just going to pay about 3 times as much for a group policy compared to an individual/family policy because they are just subsidizing the unhealthy people in the group. Both MEGA, which uses the NASE to pretend it's a "group" plan, and Midwest, which uses the "Alliance for Affordable Services" to pretend it's a group plan, (all of which are owned by UICI) perform underwriting on an individual basis and will not cover pre-existing conditions. If you have a serious health condition and can't get individually underwritten insurance, the best thing to do is get a self-employed group of one policy. Or better yet, join the state risk pool like Cover Colorado. If you see how much policies like this are, you'll see what I mean. But some people don't have a choice.
Want to do some more research on MEGA/NASE/Midwest/Alliance? I'll get you started...
HERE (a very informative article from "The Health Care Blog" - the comments are very helpful too)
here
here
here
here
here
here
here
here
here
And more, here and here.

I could've written hundreds of pages on the problems with NASE, but the last thing I'll point out is that MEGA/NASE and Midwest/Alliance were each fined $75,000 a couple years ago by the Colorado division of insurance for misleading consumers about their health coverage, among other sales violations. You can read more about that here.

Finding the Right Health Insurance

2006-08-21T13:58:00.000-06:00

Voxen's Blog shows how much of health insurance makes sense to people when they start looking around. The insurance companies start to forget that not everybody is using terms like traditional health insurance, coinsurance, copayment, and deductible on an everyday basis, and tend to not explain the coverage very well. Not only is it hard to decipher all of the terms used and break down all of the plans a company may offer, but there are numerous other companies with just as many plans.
A health insurance broker does nothing else but deal with all of these different options all day. At Insurance Shoppers, for example, we're able to look at all of the options available to somebody and narrow those options down to 3 or 4 that we think will work best. We put them in a side-by-side format, like this, so it's easy to see the difference between each plan. Then, we help you apply and get through underwriting.
After you have the health insurance in place, a broker will always be there to help you with any problems you have with billing or claims. (If you think deciphering the sales material was tough, wait until you get an explanation of benefits saying why they aren't paying a claim). In addition, each year we will compare the best options available to you so you can always be sure you have the best policy you can get.

Why Don't People Use Brokers?
That is what I'm always trying to figure out. When I'm talking to clients about it, quite a few of them tell me they thought there would be an extra charge for having a broker. And I could see why they would think that, because for a lot of services like real estate or stocks, having a broker does cost more. But for any type of insurance you buy, the price for any given policy is always the same whether you buy it directly from the insurance company or from a broker. So, it's like you're paying for a broker whether you have one or not.
I'm guessing that's Voxen's reason for trying decipher all of the Blue Cross stuff himself instead of having a broker figure it out for him. If anybody has any other reasons, I'd like to read your comments.
By the way, a good option for people like Voxen is Tonik, from Blue Cross Blue Shield. We only do health insurance in Colorado and Texas, but Tonik is available in California too.
Good luck!

prescription advertising

2006-08-18T15:27:00.000-06:00

Over the last several years, as health care costs have skyrocketed, insurance companies have been searching for ways to keep their expenses in check. One of the most common avenues we've seen for this is the lack of prescription coverage on new policies. Several big-name health insurance providers are now offering policies with no prescription coverage, or coverage for generic medications only. Some insurance carriers offer no prescription coverage at all on any of their plans, unless a separate prescription rider is added to the policy. If prescriptions are not covered, this means that not only do you pay full price at the pharmacy, but the amount you pay is not counted towards your deductible or included in your 'total out-of-pocket' with the insurance company. For a $40 medication, this may not be a big deal. But what if you become seriously ill and need a prescription that costs $500/month?
This leads me to question whether pharmaceutical companies should be allowed to advertise on TV and in magazines. I recognize that there needs to be some money in pharmaceuticals, otherwise the research and development aspects of the industry would be stunted. But it may be getting a little carried away. Should the industry really be spending millions of dollars for a 30 second spot about an acid reflux medication? Or for a two-page magazine spread about an anti-depressant? No wonder the general public believes that the cure for what ails them is a pill ("yes, doctor, I'd like an Rx for the medication that the pretty lady on TV uses. You know, the lady playing catch with her puppy in the park...')
In cases of serious illness or injury, access to medication can be the difference between life and death. And yet more and more health insurance policies are being designed without this vital coverage. A responsible society would try to curb the use of prescription drugs, rather than advertising them to the public, most of whom do not have medical training. By limiting pharmeucital advertising, perhaps we could bring down the overall cost of medicating the population, and insurance companies wouldn't be so quick to offer policies without Rx coverage.

HSAs Aren't the Answer

2006-08-18T10:50:00.000-06:00

Don't get me wrong, I think HSAs are the best thing going right now. But they are not a solution to this country's healthcare problem like this administration claims they are. HSAs are a great alternative to traditional healthcare if you have the money to pay the premium and still have extra money to invest. If this works for you, great!
But if so, you are not the type of people that are part of the growing healthcare crisis. There are nearly 45 million Americans that are uninsured. I agree that some of those uninsured just have their priorities mixed up and may have plasma TV's and iPod's at the same time they "can't afford" health insurance. But most of those 45 million really can't even afford the premium for an HSA qualified high deductible health plan, let alone the extra money to invest in the health savings account.
Our government needs to think of a real solution to this healthcare crisis soon (other than slashing Medicare). But as soon as any other ideas are mentioned, critics start screaming "national healthcare". They claim that any type of national healthcare program would increase the already inflated tax burden on families and businesses. This message is so loud because the insurance industry is providing the megaphone.
I'm the only health insurance broker I've seen that isn't screaming about how HSAs are the magic bullet for everybody's needs. For our clients in upper income tax brackets, I am saying that. But health insurance companies and brokers are acting like the healthcare crisis in this country is now fixed because of HSAs. Mainly because they fear that helping the uninsured with anything that smells like national healthcare would put them out of the job.
Actually, it's their idea to look the other way that's going to put them out of the job. As more and more people can't afford health insurance and aren't paying premiums, they're still getting necessary medical services and eventually aren't able to pay the doctor or hospital. The doctors and hospitals need to shift those costs and charge more to paying clients, or the insurance companies. This, in turn, increases the premiums for everybody with health insurance and will cause a few thousand more to be unable to afford their health insurance anymore. And that cycle will continue to accelerate and is just about to explode in our faces.

Humana Creates RightSource

2006-08-17T21:13:00.000-06:00

For mail order prescriptions, Humana has been using Walgreens. They must now feel they can do a better job with customer service and probably cut costs a little by doing it themselves, because they just created RightSource. RightSource is their own prescription drug facility. Starting September 1, they will start moving the mail order prescriptions of their clients' from the Walgreens mail service to RightSource. If you are a Humana mail order customer, you shouldn't notice a difference.
Humana mail order clients can now receive a 90 day mail order supply. Humana claims that the new system will cut costs and offer more generic alternatives and discounts, saving their customers money. Humana will also notify the clients when they receive their order and when they ship it, and customers will also be able to speak directly to a pharmacy technician.if they need help.

Humana finally offers a high deductible - high deductible health plan

2006-08-16T20:01:00.000-06:00

For several years, Humana has been one of our "go-to" plans at Insurance Shoppers when it came to high deductible health insurance plans. But lately, plans from Anthem Blue Cross Blue Shield of Colorado and United HealthCare have offered more choice by having the more desireable deductible for people looking for that type of plan.
If somebody is looking for an HSA qualified High Deductible Health Plan (HDHP), they understand that they can save a lot of money by self-insuring non-catastrophic events. The highest deductible Humana had was $2,650 for individuals or $5,150 for families. The niche of people looking at plans like this really want to save money and they can already find plenty of other plans to compare with this deductible. When they do compare, the 100% coinsurance is going to be more expensive because it offers less of an exposure and the 80% coinsurance is right in line with a lot of plans that can offer more benefits - like non-HSA qualified plans.
Well, now you can actually find a Humana HSA qualified plan with a $5,000 deductible for individuals and a $10,000 deductible for families in Colorado and Texas. For more information about these plans, visit the Humana page at Insurance Shoppers.

Mergers limiting choice - Part II

2006-08-14T20:24:00.000-06:00

5 days ago, I made a post about the latest mergers of health insurance companies doing business in Colorado. The gist of it stated that new supercompanies of Anthem Blue Cross Blue Shield and United HealthCare were formed. The United HealthCare merger gulped up 4 companies that were once competing and combined them into 1 - this reducing your choice as a consumer. Another thing this would create is a company with such a large market share in Colorado that it would have unfair leverage when negotiating contracts with doctors and hospitals. A small family practice probably can't afford to lose all of it's clients that belong to such a large company.

Apparently, a hospital chain as large as HCA can. While contract negotiations between the two sides have been going on for months, United HealthCare released a statement today saying:

"While these discussions are ongoing, HCA has sent UnitedHealthcare a notice that would terminate the UnitedHealthcare contract in Tampa and South Florida on August 29, 2006 and in Denver on August 31, 2006. Golden Rule is mailing notification to insureds in those markets today."

The following Denver, Colorado area HealthOne (HCA) hospitals & ambulatory centers will be affected by the termination of the HCA contract:
Hospitals
North Suburban Medical Center
Presbyterian/St Luke’s Med Ctr
Rose Medical Center
Sky Ridge Medical Center
Spaulding Rehabilitation Hospital
Swedish Medical Center
Med Center of Aurora

Ambulatory Surgery Centers
Centennial Medical Plaza
Centrum Surgical Center
Clear Creek Surgical Center
Lakewood Surgical Center
Lowry Surgery Center
Med Center of Aurora North – IP
Midtown Surgical Center
North Suburban Surgery Center
Rocky Mountain Surgical Center
Rose Surgical Center
Sky Ridge Surgical Center

Bad advice

2006-08-09T21:49:00.000-06:00

Below is a funny letter to the editor from the Indianapolis Star - view the original

The Aug. 1 editorial, "Do-it-yourself fixes for high health costs," neglected one significant step consumers can take to hold down costs: If you are relatively young and healthy, don't buy health insurance. Learn to distinguish between the cost of health insurance and the cost of treatment, and be aware that for the large majority insurance premiums are approximately five to 10 times the actual cost of medical care in any given year. For a family of four, the break-even point is about $4,000 to $5,000.

James Huston
Rushville

This advice works just fine if you can see the future. The problem for most people is that, they can't. If you don't have any health insurance and have over $4,000 to $5,000 worth of medical expenses, you're not going to be able to get health insurance. It's like trying to get homeowners insurance after your house burned down or auto insurance after you've totalled your car.
The best solution for the young and healthy is to get catastrophic health insurance that will give them an exposure similar to what James was talking about (between $4,000 to $5,000) in deductible or deductible/ coinsurance mix. Tonik from Anthem Blue Cross Blue Shield is targeted right at that age group. The only problem with the Tonik plans is that they don't cover brand name prescriptions, but that is usually the lowest probability for that age group. It's all a gamble in the end.