Aetna CEO: Health Insurers Face Extinction

[somarco]

Co-op's and ACO's are one thing. Health insurance on the exchange something different.

The co-op and ACO market will have to secure reinsurance in the private market which will create it's own problem. If they are too aggressive they will blow up in 3 years or less.

 

[Yagents]

Does This Move Defeat the Purpose of Obamacare? (AET)

 

[Ann H]

commissions have to be the same level in and out

I don't know about the California state exchange, but for Federally Facilitated Exchange states, this only applies to the SAME plan in and outside the exchange. So, for carriers participating in the exchange, who offer plans both inside and out, they still can have different commissions if the plans are not substantially the same. And HHS has said in its latest proposed rule that plans are different if they have differing networks, slight differences in plan designs, etc.

Homeless Jerry could get a $500 credit limit Master Card from __rch___ Bank with a 40% interest rate. Instant online approval and card number sent to e-mail address. Jerry buys an ObamaCare policy this month, gets his hip replacement next month and some therapy during the 60 day grace period before the policy lapses.

Over the past 5 years, there's been a rapidly growing number of professional "system gamers", for some reason.

Although the grace period is 90 days for SUBSIDIZED plans, only the first 30 days of claims are guaranteed. So, in the first 30 days that a member does not pay his share of the premium, the insurance company can still collect the subsidy amount, but the insurer also still must pay the claims for those 30 days. Then, the insurer must notify all current providers for that member that the policy is in lapse status. For days 31-90, the insurer can hold back claims and the govt can hold back subsidies. If the member does not pay the premium by day 90, the policy lapses back to day 31. So, the member got away with 30 days of free coverage.

Please also note that for NON-SUBSIDIZED business either in the exchange or the Private Market, the state's grace period rules apply (usually 30 days).
- - - - - - - - - - - - - - - - - -

For starters, one "Big Deal" is this...Insurance companies must accept all forms of payment but can't pass along any transaction fees charged by the financial institutions. For example, VISA / MasterCard charge the insurance company 2% to 3% of the transaction. For a $600 premium placed on a Visa/MC, the insurance company has to pay Visa/MC $12 to $18 EVERY month.

This is HUGE. That could impact our commissions in a big way, too. Either the insurer should be able to add this to premium, or else deduct it from the MLR. It is not right for the govt. to hit them with a 2-3% surcharge in the 8th inning.

 

[AllenChicago]

It looks like the Obama Administration is preparing to unleash yet another set of regulations. Up until now, Health Insurers have been relatively accommodating, but this latest volley might just cause all private insurers to leave the state exchanges.

"HHS proposes new oversight and contractual requirements for QHP Issuers with regard to their contractors and subcontractors–"Delegated Entities" and "Downstream Entities" in Exchange parlance. These definitions include providers of both administrative and health care services, and therefore are inclusive of hospitals, accountable care organizations and other health care providers with which QHP Issuers contract. QHP Issuers are responsible for their own compliance with applicable federal and state standards as well as for the compliance of their Delegated and Downstream Entities, regardless of the relationship. Given Issuers' extensive operations and the variety of Delegated and Downstream Entities with which Issuers may contract—including marketing organizations, agents, brokers, health care providers and administrative service providers—this proposal creates a significant burden on QHP Issuers, which now are directly accountable for the compliance (or non-compliance) of their contractors."

Source: HHS Proposes Clarifications For Market Reform Regulations And New Exchange-Related Obligations But Leaves Key Questions Unanswered - Food, Drugs, Healthcare, Life Sciences - United States

Apparently the Administration is speeding up the demise of our Private Healthcare system in order to implement Single-Payer Universal Healthcare before the President leaves office. This way, Hillary can't take credit for it.
-ac

 

[somarco]

Brilliant move. If no carriers participate in exchanges, the govt doesn't have to provide subsidies.

 

[AllenChicago]

An easy and logical article (my favorite type!) that estimates where health insurance is now headed, as well as some history of today's big health insurers.

Link: OPINION: a brave new world for health insurance | The Center for Public Integrity

-ac

 

[AllenChicago]

May 12, 2015

AETNA may soon purchase, or merge with, either HUMANA or CIGNA.

Story: Aetna Merger With Cigna or Humana Could Be ‘Imminent’ - Stocks to Watch - Barrons.com

 

[CHUMPS FROM OXFORD]

And what became of Crabcake Johnny (John P)?

 

[sman]

And what became of Crabcake Johnny (John P)?

Last I heard he was creating websites. But who really knows at this point. He doesn't seem to stick with one thing for very long.