DeMint Opposes Gov’t Mandate for Pre-Existing Conditions Coverage

[thall]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Dave, give us a clue, we all know there is something amiss with the system like it is. If it gets to the point that it's not profitable for you are you going to continue,no, I think not. Why should the insurance cos. work in an unprofitable situation? I just want to hear some reasonable solutions other than ultimately turning it over to the government.

 

[YouGotMyMoney]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

People should have access to affordable premiums, not cheap but something realistic.

In FLA, before this pos ppcca or whatever u call it, u had to go on hipaa.....and most broker would sell gr hipaa, cause they are the only ones who pay $$, $1000 prem x 20-25% increase every year, plus deductible coinsurance on copay select, hurts a lot of people.

 

[Dave020]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Dave, give us a clue, we all know there is something amiss with the system like it is. If it gets to the point that it's not profitable for you are you going to continue,no, I think not. Why should the insurance cos. work in an unprofitable situation? I just want to hear some reasonable solutions other than ultimately turning it over to the government.

It's going to become a hybid system, government intervention in IFP and tweeks in group.

Simply put, when I submit HIPAA business the carriers cringe. If I take the same couple or family and qualify them for small group coverage (GI in CA), no mess no fuss. "Send us as may as you want".

Anthem told me straight up that it is because there are two pots of premium money and IFP is a losing pot (HIPAA or underwritten) while group is profitable. Anthem CA estimates losses on IFP in 2010 in CA alone of over 100MM.

CA currently estimates that the "exchange" if it comes into being will address 3.8MM people. We currently have 8.2MM uninsured with a population of almost 40MM. That means the exchange impact will be minimal and likely (as it is now on healthcare.gov) targeted at IFP level business.

I will leave it to Bob (Somarco) or others to explain why a couple in their 50's with cancer is a carrier-killer on HIPAA but not a loss-leader on small group.

 

[somarco]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

I will leave it to Bob (Somarco) or others to explain why a couple in their 50's with cancer is a carrier-killer on HIPAA but not a loss-leader on small group.

Gee thanks, Dave . . .

Ultra small group is a money loser. The twosies and threesies are killer groups. Once you get above 5 lives or so you move toward break even.

Most carriers define small group as 2 - 49 which leaves a lot of room for spreading the risk of the micro groups.

Group blocks are tiered for experience tracking purposes. The usual grouping is 2 - 49, 50 - 99, 100 - 249, 250 - 499.

Groups above 500 lives are fully credible with the only pooling that occurs is in the internal stop loss limits, such as on claims xs of $100k+. The aggregate cap is protected by the underlying specific claim stop loss and reasonably predictable.

Groups of 2 - 49 catch the most heat and have the widest fluctuations in claim loss ratio's from year to year. This is why small groups typically have the highest rate increases.

They are also the size group that typically moves in and out of the pool with some frequency, often yearly moves. In some cases they move to another carrier, in others they simply drop coverage.

When employers drop coverage the sick people move to risk pools or in some cases to IFP if they are able to qualify.

As long as the IFP market is medically underwritten on an accept-reject basis and the carrier is able to get the rate increases they need, the block can be profitable or at least break even.

But when outside forces start messing with rates, dictating loss ratio's, etc you have a mess brewing. Add in a faltering economy where the sick buy coverage and those who are well bypass coverage and you have a perfect storm.

When you can keep the sick folks in a separate risk pool, subsidized in part by taxes and cost shifting to the other profitable lines, almost everyone is happy.

It isn't a perfect system, but a one-size-fits-all never works . . . which is where Obamacrap is taking us.

Small group, even though it is GI and has rating tiers, works when the govt leaves it alone. While Obamacrap is changing the landscape of small group the biggest impact right now is the economy.

Carriers blaming Obamacrap for rate increases, at least in the group side, is more political than anything. The economy is killing the health insurance business with a shrinking number of insureds and the ones who are insured are mostly sick.

 

[stuy119]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

One of the most informative posts on this forum. I wish there was a way to single it out for everyone, and someone could have explained it this well during the debate over health insurance reform. Except I don't think the politicians understand it that well.

 

[Dave020]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Bob, you did an excellent job with that explanation (like I knew you would ).

We are seeing the portability problem at greater levels than ever before because of the economy.

Healthy person to COBRA + Subsidy to COBRA (maybe) to nothing (too expensive/lousy benefits)

Unhealthy person to COBRA + Subsidy to COBRA to GI (HIPAA or risk pool).

No way the IFP system is going to work under that scenario.

 

[somarco]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Thx for the kind words.

Something else that helps group vs IFP is participation and employer contribution.

Obviously the employer cost sharing has a major impact on the "net" cost to the employee. The more the employer contributes the higher the participation, even among those who would only have health insurance if someone else is paying for it.

The IFP market shifts the entire cost to the employee.

Participation is a major factor in smoothing out claims experience. Carriers know that 80% of covered participants have little or no claims. So even when you write a group with some stinkers, you know that on average (except micro groups) you will have 4 "good" participants for every 1 "bad" participant.

Carriers don't have that luxury in the IFP market since (absent a mandate) there is no forced participation.

As the economy sours group plans are affected, especially smaller groups, but the IFP is impacted even more so.

Back when Obamacrap was still being debated, there were at least a few individuals that made note that the easiest and quickest way to cover more people was to put them to work. Unfortunately, rather than stimulating the economy in a way that would encourage higher employment they went in the opposite direction.

 

[VolAgent]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Isn't it like 1 in 5 or 1 in 4 motorists don't have auto insurance? This is a product that is required in most if not all states, basically anyone can get, and is generally affordable except for the absolute worst drivers. There is no employer wrapper to deal with, just walk into your local P&C office and write a check.

If 1 in 5 eligible Americans chooses not to protect something they actually care about, why are we surprised a similar number choose not to protect their health?

 

[Dave020]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Isn't it like 1 in 5 or 1 in 4 motorists don't have auto insurance? This is a product that is required in most if not all states, basically anyone can get, and is generally affordable except for the absolute worst drivers. There is no employer wrapper to deal with, just walk into your local P&C office and write a check.

If 1 in 5 eligible Americans chooses not to protect something they actually care about, why are we surprised a similar number choose not to protect their health?

Bingo! Groups have mandatory participation requirements, IFP does not. Healthy people can't choose to sit out on employer plans just because they don't feel like paying (in some cases very little) premium.

 

[Ann H]

Re: DeMint Opposes Gov't Mandate for Pre-Existing Conditions Cove

Back when Obamacrap was still being debated, there were at least a few individuals that made note that the easiest and quickest way to cover more people was to put them to work.

You've got to love the simplicity of creating jobs and reducing the number of uninsured at the same time!