Colorado Health Insurance Brokers

Eric Smith, Local Agent
eric@mountaininsurance.com
(720) 974-1703

He offers a free sit down meeting to review your health insurance protection package you have in place for your family. It’s amazing what he can uncover when given the opportunity. It’s rare where he will not give you an option to $ave money on health insurance. He can split family plans up, re-write onto individual from group, offer high deductible plans with accident enhancements, and numerous other strategies to $ave Americans money. It’s difficult to find the right plan, so allow Eric to help you find that plan!

Health Insurance Basics: Group coverage vs. Independent

There are key differences between individual and group insurance plans. Individual health insurance plans were designed to provide insurance to unemployed or self-employed persons not covered under their employer’s plan. In some cases, individual insurance can be difficult to obtain at any price. People with pre-existing, previously diagnosed, or treated health problems seeking new health insurance policies are considered high-risk by insurance companies, and may be unable to find affordable health insurance or any health insurance at all.

On the other hand, group insurance plans, which provide coverage for two or more individuals, cannot single out high-risk individuals; nor can they deny them health coverage. All individuals are covered regardless of their existing health problems, and high-risk individuals are factored into the total cost of the group plan.

The plan descriptions that follow outline the types of individual and group insurance plans widely available today.

Individual insurance. Since group insurance is so prevalent and lucrative, fewer and fewer carriers offer individual insurance. Individuals can purchase health insurance on their own, but it’s usually very costly. It’s estimated that 46 million Americans don’t have health insurance.

Indemnity plans. With these pay-as-you-go plans, individuals pay a set deductible and a percentage of covered expenses. After a predetermined out-of-pocket amount is reached, the health plan pays further expenses. Participants with indemnity and other fee-for-service plans are free to use any doctor or hospital they choose, and then file claims for reimbursement.

Medical savings accounts. Individuals with medical savings accounts (MSAs) create tax-free trusts to pay for out-of-pocket health care costs such as medical bills and deductibles. With an MSA, people can reduce their monthly insurance premiums. They use the funds in their MSA to pay small medical bills, and rely on health insurance to cover large bills and catastrophic events.

Group Insurance. Although Census Bureau data indicates fewer people are obtaining coverage through their places of business, most Americans with private insurance obtain their coverage through group plans. Typical benefit plans cover a combination of disability income programs, plus health, dental, vision, life, and accidental death and dismemberment insurance. Other types of insurance coverage include short-term disability, long-term disability, prescription drug, long-term care, and dependent-care.

Whether you are on a group, short term, or individual plan, you should always consult with a Health Insurance Specialist, Eric Smith at Mountain Insurance Brokers is very well versed and can answer any questions. (720) 974-1703

1/3 of Americans do not have Life Insurance

Nearly a third of U.S. households have no life-insurance coverage, the highest percentage in more than four decades, according to research firm Limra.

About 35 million U.S. households neither own their own life-insurance policies nor are covered under employer-sponsored plans, up from the 24 million, or 22% of households, without coverage in 2004, according to the study this year by Limra, of Windsor, Conn.

Limra is an industry-funded research organization that has conducted periodic surveys of ownership trends since 1960.

The percentage without life insurance is a sign of the financial pressures on middle-income families as the economy struggles.

The rise reflects tight household budgets, loss of employer-provided coverage as a result of layoffs, and cutbacks by some employers in their benefits packages, Limra said.

Half of the respondents in the latest survey said they needed more life insurance, but many haven’t bought it because their financial priorities include paying off debt.

Among households with children under 18, four in 10 respondents said they would immediately have trouble meeting living expenses if a primary wage earner died, and another three in 10 would have trouble keeping up with expenses after several months.

“Clearly, more American families are living on the edge, surviving paycheck to paycheck, and, as our new study suggests, too many are without the safety net that life insurance provides,” said Robert Kerzner, president of Limra.

While the poor economy is a factor in the most recent decline in coverage, the life-insurance industry itself shares blame in the falloff in sales, according to other recent studies and consumer advocates.

Prices of term life-insurance policies have dropped in recent years amid competition, but other types of insurance remain expensive to many middle-income consumers, and they often are put off by the hardball tactics of commission-paid sales agents.

The industry also is grappling with a decline in the number of agents who sell to middle-class families, often described as those with household incomes of between about $35,000 and $100,000 a year.

Since the 1970s, the number of company-affiliated life-insurance agents has dropped by nearly one-third, to 174,000 in recent years, according to data from Limra.

Many agents have focused on higher-income families, who can afford the bigger policies that pay the higher commissions. Many also have favored sales of investment and retirement-income products like variable annuities, which also pay commissions.

Life-insurance coverage provided through benefits packages at work has played a significant role in protecting families in recent decades, but it may be lost if the wage earner loses his job or reduces work hours.

Employers scaling back or eliminating coverage is another factor in the declining percentage of households with insurance, Limra noted.

The number of households relying solely on life insurance provided through an employer shrank to one in four, from about one in three in 2004, when the previous survey was conducted.

And over the same period, the percentage of all households that have life-insurance protection outside of an employer-sponsored plan dropped to 44%, from 50%.

Many survey respondents said they didn’t know where to get help buying life insurance. Almost eight in 10 don’t have an insurance agent or broker.

Sixty percent of baby-boomer households would prefer to buy life insurance face to face, while younger generations are interested in gathering information online, the survey found.

In 2009, insurers issued 9.4 million individual life policies in the U.S., about one million fewer than in 2004, according to Limra.

Analysts said the industry hasn’t solved the puzzle of how best to reach middle-income households in a cost-efficient manner and in a way that enables consumers to feel comfortable making financial decisions.

Grandfathered Plans Will Be Rare By 2014

Several provisions in the new health care reform law will begin to take effect next month.  More changes will take place over the next three years, leading up the biggest changes in 2014, when all individual policies will have to be guaranteed issue, and everyone will be required to have health insurance.

The only way an insurance policy will be able to avoid some of the changes implemented by the new law is to retain grandfathered status, basically by keeping the policy mostly unchanged from the way it was on March 23, 2010, when the law was passed.  But it turns out that the benefits of grandfathering a policy aren’t really worth the restrictions involved, for most US companies.  Ninety percent of employers expect to lose their grandfathered status before 2014, mainly because they want to be able to make significant changes to their plan design or adjust the amount that they contribute to employees’ premiums.

Some of the new rules will apply to all policies, even if they retain grandfathered status.  The ban on rescission except for causes of fraud, the ability for people to remain on their parents’ policy until age 26, and the removal of lifetime coverage maximums will apply to all policies, grandfathered or not.  In addition, employer sponsored group plans will have to provide coverage for children regardless of pre-existing conditions, even if the plan is grandfathered.

Most large employer-based plans already offer many of the protections that are included in the Affordable Care Act, which likely explains why employers would rather choose flexibility over grandfathered status.  They won’t have to make significant changes in order to conform with the law, and they want to retain the option to decrease benefits or lower their contribution rates in order to keep their health insurance costs in check.

Small employers and people with individual health insurance are more likely than large groups to make significant plan changes or switch to a new carrier in any given year, so it’s reasonable to expect that most people with small group or individual coverage will not be on grandfathered plans by 2014 either.

Pre-existing Health Insurance Amendment 63

Throughout this year, the Independence Institute has been working to get a measure on the ballot in Colorado to block the health care reform legislation that would require everyone to have health insurance starting in 2014.  Yesterday, the Colorado Secretary of State confirmed that the amendment supporters have gathered enough signatures to get the measure on the ballot, so it will be up for a vote in November.

Interestingly, the amendment wording does not make any attempt to reverse the provisions in the PPACA that require health insurance carriers to accept all applicants as of 2014.

If I understand it correctly, the backers of the Right to Health Care Choice Initiative want a health insurance system that would require health insurance carriers to accept everyone who applies (since they seem to have no problem with that part of the PPACA), but with no requirement that people purchase health insurance.  While I can understand the desire to be free from government regulations that direct how we conduct our lives, this particular freedom only works if the health insurance carriers can be free to determine which applicants they will accept and which they won’t (the way our system currently operates).

Most people I’ve talked to can see the problem we would have if we were to remove the guaranteed issue aspect of health care reform but keep the mandate portion (ie, require everyone to purchase health insurance but still allow health insurance carriers to underwrite based on medical history).  For some reason, the opposite scenario doesn’t seem as far-fetched to a lot of people.  But in reality, it just wouldn’t work.  I cannot see any conceivable way that health insurance premiums wouldn’t dramatically increase if all individual policies had to be guaranteed issue but people could come and go as they pleased from the health insurance system.

Regardless of whether amendment 63 passes or not this fall, federal law still overrules state law and Colorado will have to go along with the provisions of the PPACA unless there are changes to the law on a federal level.  But it will be interesting to see what the people of Colorado think about this issue.

Colorado ranked #8 on National Health survey

Ranking: Colorado is 8th this year; it was  14th in 2008.

Strengths: Strengths include a low prevalence of obesity at 19.1 percent of the population, low levels of air pollution at 7.7 micrograms of fine  particulate per cubic meter, few poor mental and physical health days per month at 3.0 days and 3.2 days in the previous 30 days, respectively, low rates of deaths from cancer and cardiovascular disease at 166.1 deaths and 235.1 deaths per 100,000 population, respectively, and a low rate of preventable hospitalizations with 53.7 discharges per 1,000 Medicare enrollees.

Challenges: Challenges include a high prevalence of binge drinking at 16.6 percent of the population, a high rate of uninsured population at 16.1 percent and high geographic disparity within the state at15.8 percent.

Significant Changes: In the last year, public health funding increased from $74 to $88 per person. In the last year, the rate of deaths from cardiovascular disease declined from 247.0 to 235.1 deaths per 100,000 population. In the past five years, immunization coverage increased from 67.5 percent to 80.7 percent of children ages 19 to 35 months receiving complete immunizations. In the past ten years, the prevalence of smoking decreased from 22.8 percent to 17.6 percent of the population. Health Disparities: In Colorado, smoking is more prevalent among non-Hispanic blacks at 25.2 percent than non-Hispanic whites at 16.5 percent. Mortality rates vary by race and ethnicity in Colorado, with 835.3 deaths per 100,000 population among blacks compared to whites, who experience 748.5 deaths per 100,000 population.

State Health Department Web Site:

www.cdphe.state.co.us

Insurers, Young, Uninsured All Prepare For Different Changes Under Health Reform

Insurers, the young, the uninsured and lawmakers are just a few of the groups sorting out what the implementation of health reform means for them as details emerge on changes to the system.

The New York Times: Insurers are fighting over the details of how much of the premiums they collect they must spend on health care. “The law requires health insurers to spend at least 80 cents out of every dollar they collect in premiums on the welfare of patients, a critical issue for the companies’ bottom lines.” Sides are fighting over just what would be considered “care,” however. “WellPoint, which operates Blue Cross plans in more than a dozen states, wants to include the cost of verifying the credentials of doctors in its networks. Insurance companies like Aetna argue that ferreting out fraud by identifying doctors performing unnecessary operations should count the same way as programs that keep people who have diabetes out of emergency rooms.” Some even say sales commissions or taxes on investments should not be considered part of insurance premiums, which would “make it easier for them to meet the 80-cent minimum.” Consumer groups are pushing back against such inconsistences. The National Association of Insurance Commissioners is tasked with offering guidelines for the so-called “medical-loss ratio,” and will submit a final draft of its work as soon as next month (Abelson, 7/23).

The Wall Street Journal: The relatively young may get more coverage cheaper at the expense of the old. The Journal reports: “Humana Inc., Mary Baumann’s insurer, intends to pare her ‘Medicare Advantage’ plan to make up for the smaller government payments it will soon receive as a result of the new law, leaving her with higher costs or fewer services.” Baumann’s son, however, is looking forward to “stable coverage” to pay for his insulin shots and blood tests. “Across the country, dozens of private insurers that run similar Medicare plans are preparing to pare dental, vision and certain prescription-drug coverage starting next year, according to consultants who have helped them assemble annual bids.” The debate “also represents a change in how the government spreads its social safety net underneath Americans. Already, it’s creating tensions that are a harbinger of debates to come.” Providing coverage for the younger in the health law is paid for by lower fees to hospitals and others that participate in Medicare, mostly in extra benefits (Adamy, 7/25).

The Columbus (Ohio) Dispatch: Many uninsured people are already anticipating coverage that’s affordable. “In 2014, companies will face penalties if health premiums exceed 9.5 percent of a full-time worker’s income. If an employee still can’t afford coverage, he or she will be eligible for a subsidy through state health exchanges to help buy an affordable policy.” For employers, those who don’t offer coverage will face a penalty of $3,000 for each employee that enrolls in the exchange or $2,000 for each full time worker (excluding the first 30 employees), whichever is less (Hoholik, 7/26).

Time: The law’s mandates – both on individuals to carry and on employers to provide health insurance – remain among the most contentious aspects of the law. “But at least in San Francisco, where an employer mandate was instituted in 2008, most business owners are embracing the new rule and reporting it’s had little impact on their operations. … That’s not to say that the mandate hasn’t been a point of contention. In fact, the long-term viability of the San Francisco employer mandate was in doubt until June when the Supreme Court declined to hear a case challenging its legality.” Many restaurants, which are also hit by the mandate, are adding three to four percent to customer bills as a health care surcharge. “San Francisco is not the only place that’s testing an employer mandate ahead of the new federal rule’s implementation four years from now. Hawaii launched a mandate in 1974 and Massachusetts did so in 2007. In both states, the mandate has successfully lowered the rate of the uninsured far below the national average, without substantially adversely affecting businesses” (Pickert, 7/26).

The Washington Post: The changes also come as nonprofit health insurers sit on what could be unnecessarily large surpluses, the Consumers Union says. “The report released Thursday by the Consumers Union, the nonprofit publisher of Consumer Reports, found that seven of 10 Blue Cross Blue Shield affiliates examined had amassed surpluses that are more than three times the level regulators deemed necessary for them to remain solvent. At the close of 2009, for instance, Blue Cross Blue Shield of Arizona had a surplus of $717 million, more than seven times the regulatory minimum. That same year, the company raised premiums for its individual market customers between 8.8 and 18.4 percent.” Other insurers proposed similar surpluses. “For-profit plans are less likely to accumulate surpluses substantially above the required minimum because they have an incentive to give the money back to shareholders as profit, said Sondra Roberto, a staff attorney at Consumer Reports who co-wrote the report.” The nonprofit insurers say that if they used the surpluses to push down premiums, it would provide only a temporary reprieve, and that they need the surpluses to guard against unexpected expenses (Aizenman, 7/26).

The New York Times, in a separate story: On the politics side, Democrats are promoting free provisions of the health law to win votes in November. “You can see it in the administration’s piece-by-piece rollout of the new health care law, and Mr. Obama’s travels to highlight individual benefits of economic stimulus legislation. … The White House demonstrated its step-by-step messaging on health care last week with a video from Michelle Obama and Jill Biden on new preventive care services, and the award of grant money for states to assist new parents. Mr. Obama’s aides insist it is gradually working, pointing to polls showing an uptick in public support for the health care law. ‘Good luck with that,’ said [Neil] Newhouse, [a] Republican pollster. The administration and Democratic candidates are only ‘treading water’ with such positive messages, he said” (Harwood, 7/26).

(Louisville, Ky.) Courier-Journal: Finally, at the National Conference of State Legislatures, lawmakers told colleagues that they need to start thinking about the health law changes that take effect in 2014 now. “‘You are already behind the eight-ball,’ Utah House Speaker David Clark told fellow lawmakers at a health summit, part of the four-day conference. ‘There is no time to waste.’ … Several Kentucky lawmakers were among the more than 100 legislators and others from across the United States who attended the all-day session. Some expressed concern Kentucky isn’t moving fast enough to plan for the new law” (Yetter, 7/25).

Anthem Blue Cross Blue Shield

The Blue Cross Blue Shield Association (BCBSA) is a federation of 39 separate health insurance organizations and companies in the United States. Combined, they directly or indirectly provide health insurance to over 100 million Americans.[3] The history of Blue Cross dates back to 1929, while the history of Blue Shield dates to 1939. The Blue Cross Association dates back to 1960, while its Blue Shield counterpart was actually created in 1948. The two organizations merged in 1982, forming the current association. The company has its headquarters in the Michigan Plaza complex in the Chicago Loop area of Chicago, Illinois.