Posts in health insurance

Pay a Higher Deductible or a Higher Premium?

May 11, 2018 Posted by health insurance 0 thoughts on “Pay a Higher Deductible or a Higher Premium?”

It’s the ultimate insurance debate: pay a higher deductible or higher premium? With many employers looking for ways to cut costs, the question to increase your monthly health insurance premiums or to pay a higher deductible is a concern you may be facing sooner rather than later.

First, let’s clarify the difference between a premium and a deductible.

  • A premium is the amount of money charged by your insurance company for the plan you’ve chosen. It is usually paid on a monthly basis, but can be billed a number of ways. You must pay your premium to keep your coverage active, regardless of whether you use it or not.
  • A deductible is a set amount you have to pay every year toward your medical bills before your insurance company starts paying. It varies by plan and some plans don’t have a deductible.

In 2017, more employers than ever included a high-deductible option on their 2017 menu of health plan offerings. An August survey of 600 U.S. companies by benefits consultancy Willis Towers Watson found that by 2018, nearly half will offer these plans exclusively. In 2006, high-deductible plans covered just 3 percent of workers. Fast-forward to 2016, and that figure was 29 percent, benefits consultancy Mercer found.

High Deductible Health Plans (HDHPs): Pros and Cons

HDHPs work differently than traditional POS (Point of Service) or PPO (Preferred Provider Organization) plans in that all healthcare expenses are paid out-of-pocket until the deductible is met. The concern with high deductibles is that it causes patients to not seek medical treatment because they fear the expense. Ultimately, this causes more extensive issues later on, such as those relating to diabetes, hypertension, depression, even cancer.

HDHP Pros:

  • Premiums are typically lower than with POS or PPO plans
  • Networks are not necessarily narrowed, as with HMOs
  • People who rarely use their health benefits may save money
  • If you are not on expensive medications, your monthly bills may be lower
  • Out-of-pocket expenses are not the market rate, but the negotiated rate between the healthcare provider and insurance company
  • Policyholders can open a health savings account (HSA), which never “expires,” to help cover out-of-pocket expenses

HDHP Cons:

  • People managing chronic illnesses find that their out-of-pocket expenses are high
  • Prescriptions, office visits, and diagnostic tests are completely out-of-pocket until you reach your deductible
  • If you need surgery, you will need to hit your deductible before the insurance company will pay anything
  • If your monthly out-of-pocket expenses are high, you aren’t taking full advantage of your HSA
  • Your deductible can be quite high (sometimes as much as $13,000 for families)

Those who initially lean toward higher insurance premiums are usually looking to save money in the long run, while those who originally gravitate to the higher deductible plans are looking to put more money in their pockets right now. However, sometimes it’s not that simple.

A 2011 study by the Kaiser Family Foundation found American families are increasingly paying more and more out of pocket for their health care costs – a whopping $15,073 for a family health insurance plan. However, it’s unlikely you’ll pay that full amount. With most employer-sponsored health care plans, your company pays a hefty dose of the premiums.

The Bureau of Labor Statistics reports that in 2008, private sector companies paid as much as 71 percent of family health insurance premiums. Public sector employers dished out even more – up to 73 percent.

While a high deductible plan and its subsequent lower premiums can put more money in your pocket, as well as your employer’s pocket, right now, it isn’t always the best choice. The Kaiser Family Foundation study also determined that the average deductible on these consumer-driven plans was nearly double that of traditional health insurance. On top of that, plans with a high deductible often come with a higher out-of-pocket max as well, sometimes as high as $10,000 a year for a family insurance plan.

Which plan is right for you?

As health insurance is not a one-size fits all item anymore, each person has to weigh the pros and cons of high deductible health plans against how they might need to use the policy. A person without an extensive medical history and unmarried without children might be able to risk such a plan. However, if an individual or someone in the  family sees a doctor once a month or needs to manage a medical or mental condition, perhaps a PPO would be a better.

Ultimately, choosing the right plan for you and your family can seem like you’re gambling with both your health and your money. If you are unsure of the insurance plan your company is offering you, a licensed insurance agent can assist you in finding a plan directly from the best health insurers.

Mental Health Insurance

May 2, 2018 Posted by health insurance 1 thought on “Mental Health Insurance”

Since 1949, Americans have observed May as Mental Health Awareness Month. Mental health can be an uncomfortable topic of discussion, not only for those suffering with mental illness, but for those closest to them as well. After all, no one wants to be labeled as “crazy” or have that stigma often associated with mental illness. However, mental health problems are a daily concern for millions of Americans. In fact, Mental Health America reports that 1 in 5 Adults have a mental health condition – that’s over 40 million Americans. (more…)

When you hit 35 years in the health insurance industry

April 24, 2018 Posted by health insurance 0 thoughts on “When you hit 35 years in the health insurance industry”

There’s a disconnect between many online companies/their staff and the public.  Companies seem almost robotic, two dimensional, and cold (we’ve all experienced the automated responses, no returned phone call, or what most of us hate the most – email-only support.  For the sake of transparency, we want to shatter that barrier and give you an inside look at the people that fuel the drive behind First Family Insurance and the disruption we’re causing in the individual and group health insurance space. (more…)

The Case For Health Insurance

April 11, 2018 Posted by health insurance 0 thoughts on “The Case For Health Insurance”

Most people don’t want to pay for health insurance. For those below the age of thirty living healthy and active lifestyles, health insurance is viewed as an irrelevant, unnecessary cost. The reality is no one plans to get sick or hurt.  When given an option to spend money on insurance (and the related costs thereof) or spending money to enjoy themselves, the choice is relatively simple to make. A night out on the town, or monthly premiums for insurance coverage? (more…)

Could Walmart be the next face of American Healthcare?

April 5, 2018 Posted by health insurance, news 0 thoughts on “Could Walmart be the next face of American Healthcare?”

Amazon could do a lot to fix the US health-care system – but Walmart could do more. Walmart, the nation’s biggest employer, is trying to redesign how U.S. health care works. It’s one of the few companies that has the power to succeed. (more…)

Amazon’s First Steps Into Healthcare

March 28, 2018 Posted by health insurance, news 0 thoughts on “Amazon’s First Steps Into Healthcare”

Amazon is getting into health care. That’s not speculation, at this point. The company hasn’t spoken much about its plans, as it’s still determining the scope through a series of brainstorming sessions with experts in the space, but its hiring trends and recent product development hint strongly at where it could go. (more…)

Which industry workers are least likely to have health insurance?

March 23, 2018 Posted by health insurance 0 thoughts on “Which industry workers are least likely to have health insurance?”

Most would agree working in the insurance industry is relatively physically safe, aside from the sedentary lifestyle.  Let’s be honest, our biggest risk is exposure to sick people (although no where near healthcare workers) and possibly paper cuts.  We’re fortunate enough to have health insurance coverage should something like that happen.  However, there is a group of working professionals that lead the pack regarding the lack of health insurance coverage.  These workers are also at a very high risk of injury and illness.

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Health Insurance Carrier Cigna to buy Express Scripts

March 8, 2018 Posted by health insurance, news 0 thoughts on “Health Insurance Carrier Cigna to buy Express Scripts”

Health Insurance Carrier Cigna said on Thursday it would buy pharmacy benefits manager Express Scripts for about $54 billion, the latest deal in the sector aimed at tackling soaring healthcare costs. The move follows the $69 billion merger of insurer Aetna and drugstore chain CVS Health announced last December, and highlights a sector-wide trend toward deals between companies that do not have directly overlapping operations. The deals seek to lower healthcare costs by bringing under one roof pharmacy and medical claims, and give the combined entities greater leverage in price negotiations with drugmakers. (more…)

Employees Are More Likely to Stay If They Like Their Health Plan

February 15, 2018 Posted by health insurance 0 thoughts on “Employees Are More Likely to Stay If They Like Their Health Plan”

Employer-provided health coverage is important for happy employees, but even more important for keeping them.

A new survey shows that:

  • 56 percent of U.S. adults with employer-sponsored health benefits said that whether or not they like their health coverage is a key factor in deciding to stay at their current job.
  • 46 percent said health insurance was either the deciding factor or a positive influence in choosing their current job.

“We were surprised to see such a large percentage of American workers who indicated the importance of health coverage in choosing and staying at their job,” said Phillip Morris, vice president of Luntz Global Partners, which conducted the survey for America’s Health Insurance Plans (AHIP), a trade association for health insurers.

The survey findings showed that 71 percent of employees are satisfied with their current employer-provided coverage but that high costs worry many.

Responses were gathered Jan. 25-28 from 1,000 U.S. adults receiving health care through their workplace. The results were released at a Feb. 6 expert panel event in Washington, D.C., sponsored by AHIP and the nonprofit Bipartisan Policy Center.

 Health Insurance Satisfaction Driven by Coverage, Cost and Choice
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But:

Health Insurance Costs Are Top Dissatisfaction Driver
18-0224 AHIP-02b.png

Among other findings:

  • Most workers (71 percent) remain concerned that the cost of their health plans will continue to rise.
  • The benefits they said matter most to them were prescription drug coverage (cited by 51 percent of respondents), preventive care (47 percent) and emergency care (47 percent).

Fostering Innovation

“Employer-provided insurance is the cornerstone of the U.S. health care system, covering over 150 million Americans and spurring innovation that helps improve the overall health care marketplace,” said David Cordani, president and CEO of Cigna, who spoke at the AHIP/Bipartisan Policy Center event. “Employer-provided coverage helps employers create localized communities of health to help their employees stay healthy and productive, while pursuing targeted innovation that works for their unique needs.”

“Large employers are pushing the envelope by improving access to high-quality care and driving employee engagement with their health benefits,” said Brian Marcotte, president and CEO of the nonprofit National Business Group on Health, an employers group, during a panel discussion.

He noted recent success in the growth of telehealth and virtual health coaching services, which have changed how chronic disease is being managed.

“Five years ago, 14 percent of large companies offered telehealth services to their employees,” Marcotte said. “Today, 96 percent of large companies offer telehealth.” In addition, over half now offer tele-behavioral health consultations for mental health issues, “which is a 50 percent increase over last year.”

Listening to Employees

“You have to know your employees and what they want” from their health benefits, advised Paula Harvey, SHRM-SCP, vice president for human resources at Schulte Building Systems, a 600-employee metal-building fabrication company in Hockley, Texas. “Don’t just sit in your office looking at claims numbers. Get out and talk to your employees, find out what’s working for them.”

Harvey, who represented the Society for Human Resource Management on the panel discussion, is a SHRM Foundation board member and served on SHRM’s membership advisory council for the Southeast.

“Find innovative ways to get the conversation [about health] going,” Harvey said. “My employees can participate in wellness challenges with themselves” and track their progress online. “We provide walking trails” to encourage employees to get out and move during lunch or before and after work.

“It’s hard for employees to take time away from work to use their health benefits,” she noted. “We all have sick days we can use, but if we’re thinking about increasing vaccination rates or primary care visits, why don’t we offer individuals ‘healthy days’ so they can access preventative care services,” giving workers the flexibility to use their benefits.

Bringing management on board for health-promoting initiatives at her firm wasn’t a hard sell, Harvey noted. “CEOs care about their employees being healthy, because healthy employees show up to work.”

Applying Value-Based Designs

Value-based design (VBD) that “spends more on the things that make people healthier and less on the things that don’t” is increasingly part of health plans that employers self-fund, but laws and regulations have hindered its wider use, said Mark Fendrick, M.D., director of the University of Michigan Center for Value-Based Design.

He favors insurance that pays a greater share of the cost for services “when the evidence of effectiveness is strong”—such as those noted by clinician organizations participating in the Choosing Wisely initiative—”and raises the cost for services where the evidence of effectiveness is weak.”

“We need to incorporate VBD into health savings accounts, which I love, but which are tied to high-deductible health plans, which are not nuanced or flexible,” Fendrick said. He urged changing government policies to give HDHPs the flexibility to cover high-value services outside of the deductible so that “people don’t have to hold a bake sale to access services they need.”

He described wrenching e-mails he receives from employees that say, “Thank you for the no-cost mammogram, but I can’t afford the deductible for my mastectomy,” or “Thank you for the Hepatitis-C screening, but I don’t have access to the therapy.”

He added, “Sadly, many patients diagnosed with HIV through a free screening find it really difficult to afford potentially life-saving therapies.”

Looking forward, “We can make HDHPs into high-value plans,” Fendrick said. “We need to overcome government policy inertia to make this happen.”

The recently introduced Chronic Disease Management Act of 2018, for instance, would amend the IRS tax code so that high-deductible health plans paired with HSAs could cover chronic disease prevention and treatment on a pre-deductible basis.

Amazon, Berkshire Hathaway, and JPMorgan Chase to partner on US employee health care

January 30, 2018 Posted by health insurance, news 0 thoughts on “Amazon, Berkshire Hathaway, and JPMorgan Chase to partner on US employee health care”

Amazon, Berkshire Hathaway, and JPMorgan Chase on Tuesday announced plans to partner on ways to cut health-care costs and improve services for their U.S. employees. The announcement slammed the shares of multiple companies in the health-care sector.

Together, the three companies employ more than 1.1 million workers.

The three massive companies will launch an independent outfit initially targeting technology solutions, with the intention to be an umbrella firm that would be “free from profit-making incentives.”

Details of the new company were sketchy, with principles of each firm noting that the way it will work remains to be seen. They’re hoping that the sheer size of each firm will help bring the necessary scale and resources to tackle the issue.

“The ballooning costs of healthcare act as a hungry tapeworm on the American economy,” Berkshire CEO Warren Buffett said in a statement. “Our group does not come to this problem with answers. But we also do not accept it as inevitable. Rather, we share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes.”

Three top executives, one from each company, will take the lead on the project: Investment officer Todd Combs at Berkshire, Marvelle Sullivan Berchtold at J.P. Morgan, and Beth Galetti, a senior vice president at Amazon.

Combs was a hedge fund manager before joining Berkshire in 2010. Berchtold was previously global head of mergers and acquisitions at drugmaker Novartis before joining J.P. Morgan last year, and Galetti served as FedEx’s vice president for planning, engineering and operations before joining Amazon in 2013, according to their LinkedIn profiles.

“The healthcare system is complex, and we enter into this challenge open-eyed about the degree of difficulty,” said Amazon CEO Jeff Bezos. “Hard as it might be, reducing healthcare’s burden on the economy while improving outcomes for employees and their families would be worth the effort.”

“Our people want transparency, knowledge and control when it comes to managing their healthcare,” said JPMorgan Chase CEO Jamie Dimon. “The three of our companies have extraordinary resources, and our goal is to create solutions that benefit our U.S. employees, their families and, potentially, all Americans.”

The new company’s goal at first will be to target technology solutions to simplify the health-care system.

“I think it is good news,” Allergan CEO Brent Saunders told CNBC. “The health-care delivery system is antiquated and in dire need of positive disruption. My hope is these three companies light the spark!”

Adam Fein, president of Pembroke Consulting, said it’s “long past time” for employers like these three to force innovation into the health-care system.

“For better or worse, there are warped incentives baked into every aspect of the U.S. health-care system, from medical innovation to care delivery to insurance and benefit management,” Fein told CNBC. “Rather than merely bashing the current system, I hope this new organization can help patients and their physicians make more informed and more cost-effective decisions. Technology will be necessary but not sufficient to make positive changes.”

Analysts echoed the sentiment that the health-care system is outdated and ripe for disruption, paving the way for the new endeavor. However, they cautioned it could take time.

“If this winds up being the low cost provider to make insurance more affordable at employer level, it could wind up being a real disruptive competitor to an industry that has not seen any new players in years/decades,” Jefferies analyst Jared Holz told CNBC. “Not going to call this black swan event yet because there are few details and would be making too many assumptions but it has potential to be.”

Leerink Partners’ Ana Gupte said the comments suggest the leaders view the endeavor as one that’s “complex, challenging and thorny and that will take time to bear fruit.”

Shares of each company were little changed in premarket trading.

However, shares of other leaders in the industry fell sharply. CVS and UnitedHealth each were off about 7 percent in premarket trading and ExpressScripts fell nearly 8 percent and Aetna was down about 3 percent.

Source: Amazon, Berkshire Hathaway, and JPMorgan Chase to partner on US employee health care

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