Tag Archives: Group Employee Health Benefits

Health Policy Is Vital to Tax Reform Policy

Today the House Ways and Means Committee is scheduled to hold a hearing on improving the competitiveness of American businesses. It should consider health policy as well as tax policy in its deliberations.

There is strong bipartisan support in Congress for cutting the corporate tax rate to improve competitiveness. If done in a revenue-neutral manner, as the Tax Reform Act of 1986 was, that simultaneously gets rid of inefficient tax loopholes that distort business decision making, this would be a good thing. But what is really holding back the international competitiveness of American businesses isn’t so much the tax code as our health system.

The United States is unique among major countries in that health insurance for the working population is provided almost entirely by employers.  And until the Affordable Care Act, they weren’t even required to do so; small businesses are still not required.

No one ever sat down and thought up this system; it came about by accident during World War II. Because of wage and price controls, employers couldn’t raise wages. But because so many young men were in the military and the large demand for war production, many businesses had an acute labor shortage.

To provide additional compensation to get the workers they needed, some businesses started offering health insurance on top of cash wages. Before the war, health insurance was rarely provided.

Although obviously a form of income to the worker, the Internal Revenue Service nevertheless ruled that it was not taxable, although businesses could still deduct the cost. This anomalous tax treatment was a fabulous tax loophole for both businesses and workers, especially at a time when tax rates were historically high.

Eventually Congress codified the I.R.S. ruling and we have been stuck with an employer-based health insurance system ever since. Although from time to time, politicians have suggested getting rid of the exclusion for health insurance and using the revenue to create an individually based health insurance system, such efforts have been short-lived and unsuccessful.

To read the full story, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Affordable Care Act losses land N.J. health insurer in rehab

Health Republic Insurance of New Jersey,  one of 23 nonprofit consumer-operated and -oriented health plans established under the Affordable Care Act, has agreed to be taken over by regulators because of its “hazardous financial condition,” the New Jersey Department of Banking and Insurance said Monday.

The Newark, N.J., insurer lost $58.96 million in the six months ended June 30 and is expected to have a negative cash position of $17.3 million in January, according to the department’s petition for a takeover filed Monday in the Chancery Division of the Superior Court of New Jersey.

This year Health Republic tapped the last $10 million of a $94.3 million loan from the federal Centers for Medicare and Medicaid Services, the petition said. That loan was supposed to provide a capital cushion for the start-up.

Health Republic, which insures 35,950 people under individual and small-group plans, will continue paying claims this year while under rehabilitation by regulators, but will not offer plans for 2017.

To read the full story, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

HSA Limits Released for 2017

On Thursday, the IRS released the 2017 inflation adjusted amounts for Health Savings Accounts (HSAs). The maximum contribution amounts for calendar year 2017 will increase by $50 for individuals with self-only coverage under a high deductible plan to $3,400, while the contribution maximum will remain flat for family coverage at $6,750.

Sincerely,

Poll finds growing GOP support for paid family leave

Paid family leave is well known to be a popular idea among New York City Democrats, but an increasing number of Republicans here also support it, with a significant number “strongly” in favor of such a policy, according to a new poll.

Democrats saying they “strongly support” paid family leave increased to 81% in 2015 from 74% in 2014, according to the Community Service Society‘s annual “Unheard Third” survey. But the gain was far greater among Republicans, with the portion who “strongly” support it rising to 58% in 2015 from 45% in 2014. Folding in less enthusiastic backers, support among Republicans went from 65% to 74%.

To be sure, the number of Republicans surveyed this year was minuscule, just 229, indicative of New York’s small number of GOP members, so random fluctuation could account for some of the increase. But the rise in support among non-GOP voters shows it probably was not a fluke. The survey of 1,705 city residents was conducted July 19 through Aug. 17 and has a margin of error of +/-2.75%. The policy would require employers to allow their workers time off to care for a newborn or sick loved one.

To read the full story, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

 

NY health plans seek average 13.5% hike for 2016

Get ready to pay more for health care next year.

The battle over setting next year’s health insurance premiums in New York is underway after proposals seeking double-digit rate increases on average were submitted to state regulators.

Proposed rate adjustments vary widely, with an average increase of about 13.5 percent. While some health plans seek up to 30 percent rate increases, others have presented slight decreases, state records filed this month show.

Health insurance premium rates in 2016 for individual and small group plans — as opposed to larger employer-sponsored coverage plans — will ultimately be set by the state Department of Financial Services under the prior-approval process, which essentially gives the agency authority to approve or reduce the rates requested.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Cigna Rejects an Overture From Anthem

The world of American health insurance may soon become even smaller, with the biggest companies seeking to become even bigger.

A scramble has broken out within the industry as various providers jockey for position and make overtures to rivals. Anthem made the first public move, unveiling a $47 billion takeover bid for Cigna on Saturday after months of negotiations had stalled. On Sunday, Cigna fired back, rejecting the bid as “inadequate and not in the best interest of Cigna’s shareholders.”

But others have been quietly maneuvering as well. UnitedHealth Group, the biggest American health insurer by revenue, recently made a preliminary approach to Aetna, a person briefed on the matter said.

And a number of companies have indicated their interest in buying Humana, one of the smaller major insurers but one with a valuable Medicare franchise. Among those companies that had expressed interest is Anthem, though the bigger insurance provider is currently focused on combining with Cigna, people briefed on the company’s plans said. Another is Cigna.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Poll Marks a Love/Hate View of the Affordable Care Act

Public support for Obamacare tied its all-time low in the latest ABC News/Washington Post poll – even as most Americans say the Supreme Court should not block federal subsidies at the heart of the health care law.

With the high court set to rule on the latest challenge to the ACA, the poll reflects the public’s split views of the law – criticism of its insurance mandate, yet support for extended coverage.

Overall, just 39 percent support the law, down 10 percentage points in a little more than a year to match the record low from three years ago as the Supreme Court debated the constitutionality of the individual mandate. A majority, 54 percent, opposes Obamacare, a scant 3 points shy of the high in late 2013 after the botched rollout of healthcare.gov.

In spite of majority opposition overall, however, 55 percent think the Supreme Court should not block federal subsidies that help some low and moderate income Americans pay for their health insurance. Many fewer, 38 percent, would like to see the Court strike down those subsidies.

To read more, click here:

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

 

 

 

 

Employer-covered insurance doesn’t drop despite ACA, report finds

The percentage of workers covered by employer-sponsored health insurance has held steady, despite arguments that the Affordable Care Act would spur a decline. Between June 2013 and March 2015 just over 70% of U.S. workers were covered by a plan provided by their employer, according to a study released Wednesday by the Urban Institute Health Policy Center. To that end, employers regardless of company size continued to offer insurance coverage, the study found. The number of small-firm employers that offered insurance grew to 61.3% in March 2015, up from 60.6% in June 2013. To read more, click here:

Jeffrey R. Ungvary

Managing Your Medicare’s Out-of-Pocket Expenses

Medicare beneficiaries need to pay for a sometimes significant portion of their health care costs. Just like private health insurance, Medicare requires beneficiaries to pay premiums, deductibles and coinsurance. But there’s a lot you can do to keep these costs manageable. Here are some steps to minimize Medicare’s out-of-pocket costs.

Premiums.
Most people aren’t charged a premium for Medicare Part A hospital insurance. The standard monthly premium for Medicare Part B medical insurance is $104.90 in 2015. This amount is typically deducted from your Social Security check if you are already receiving payments, but those who have not yet claimed Social Security will receive a bill. Retirees with modified adjusted gross incomes above $85,000 for individuals and $170,000 for couples are charged higher Part B premiums.

It’s important to sign up for Medicare Part B during the initial enrollment period, which is a seven-month window that begins three months before your 65th birthday. Your Part B premiums will increase by 10 percent for each 12-month period you were eligible for Medicare Part B but didn’t sign up for it. “If you are 68 when you sign up for Medicare Part B, you will be hit with a 30 percent premium increase every year for the rest of your life,” says Ronald Kahan, a medical doctor and author of “Medicare Demystified: A Physician Helps Save You Time, Money, and Frustration.” If you didn’t sign up for Medicare Part B at age 65 due to participating in group health insurance through your job, you should sign up within eight months of leaving the job or the coverage ending to avoid the penalty.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Employers Urge Repeal of Small Group Expansion

The Affordable Care Act’s mandated expansion of the definition of the small group market would limit employers’ health plan options, according to employer groups who are urging the repeal of the mandate before it takes effect in 2016.

Expanding the small group market to include groups up to 100 would not only reduce choice for this segment of the market, it means some employers would be unable to keep the insurer they currently have, according to the Society for Human Resource Management and the National Association of Health Underwriters. The industry groups and more than a dozen other employer organizations are applauding efforts to repeal the ACA mandate through legislation called the Protecting Affordable Coverage for Employees Act (PACE).

The expansion is intended to make insurance more affordable for the smallest employers by expanding the risk pool to include larger companies. It also aims to increase the number of participants in the ACA’s Small Business Health Options Program, also known as the SHOP exchanges.

The PACE bill would maintain the current definition of a small group market as 1-50 employees and give states the flexibility to expand the group size if they feel the market conditions in their state necessitate the change.

“It is in the best interest of employers and their employees that states determine the definition of their small group market,” the groups argue in a recent letter to the bill’s sponsors, Senators Tim Scott (R-SC), Jeanne Shaheen (D-NH), and Michael Bennet (D-CO).

“Repealing the ACA-mandated expansion and returning to the historical role of state determination would allow flexibility and ensure a broad array of coverage options and mitigate dramatic premium increases,” they add.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary