Group Health Indemnity Plans

[Consultant]

Question:

I have a prospect that needs a CA Group Health Indemnity Plan. I can only think of two plans: UHC has only one and the Aetna has only one plan.

Anyone else know of any others?

Scenario:

Family business has Mass. Blue Coverage (I Don't know Mass. it sounds like Indemnity). Currently it covers their child's special doctors. Visits are 200 to 400 and they do not take insurance. They are paying 20,000 in premium a year for the family of four.

CA Market:

Group Indemnity is rare. Carriers focus on UCR (usual and customary rates) and pay their Out of Network on % on this pre-determined, dismally low number. Fine for In Network. Cost prohibitive for OON expenses. (Non-Emergency)

*Been awhile since I've posted. ::::Stretches arms::: Feels good!

 

[ABC]

Why not put them on an HSA with a lower out of network deductible or a embedded deductible.

That is what I have done for my small group clients that have children suffering from chronic disease. That way the family can get the tax break on the medical expenses. I always advise the client to check with their accountant on the tax break.

 

[Consultant]

Why not put them on an HSA with a lower out of network deductible or a embedded deductible.

That is what I have done for my small group clients that have children suffering from chronic disease. That way the family can get the tax break on the medical expenses. I always advise the client to check with their accountant on the tax break.

ABC: Thank you for your input. Unfortunately, I don't think you understand the concept of UCR, OON & OOP can do to a pocket book even with H.S.A's.

H.S.A's aggregate and embedded deductible terminology you are confused with. About 90% of brokers have this as a misnomer. The H.S.A. OOP for the individual, in a family policy, is the Family OOP.

Moreover, Out of network doctors that charge 400% more than UCR. (And let's face it, in CA it's a growing trend with great doctors to refuse insurance) you will still be responsible with the excess expenses.

The lowest group family OOP H.S.A. I can find is in fact $12,000.

The H.S.A. deduction this year is 5,800. So, at 35% it's about 2 grand savings.

So, the premium is $9,000 a year
OOP is $12,000.
minus $-2,000 "HSA Savings".
-------------------
Equals= 19 Thousand.

They are currently paying about $20,000 a year in premium (includes 2,000 OOP). Which is INDEMNITY.

Savings? $1000! Or wait. NO! The excess dollars over the UCR which is in this case is 10% more than Medicare fee schedule. (Dismally low).

So, now they leave themselves open to thousands of dollars in extra expenditures.

ERRR.. Sorry, again, thanks for playing... but you just lost your client $$$$$$$. And could compromise your E&O insurance. Any other takers?

I am looking for Group Health Indemnity Plans.

 

[Dave020]

Forget the domestic carriers, none of them have one. It would have to be an out of state carrier if any.

 

[ABC]

Well first off I don't lose clients.
I have lost only 2 in 9 years and they were both to AOR's.
I also have a very good understanding of network discounts and filing claims that are out of network.

Are you unable to find an HSA plan that has a lower out of network OOP max? In CA. do the embedded deductibles change when its OON claim?

When it comes to the tax write off for medical expenses anything over 7.5% of your adjusted gross income is tax deductible if you itemize. Is this the case with CA tax code?

Have you check with CA state mandates on the treatment of the childs health condition. For example In my state there are recent mandates on the treatment of Autism. I was able to get a out of network provider to be treated as if they were in network. I was able to do this even though the provider did not except insurance and recieved payment in full upfront. This providers claims run about $46,000 a year. My clients oop max on an embedded deductible is $2,000.

I am unaware of any group indemnity products atleast in my state. Most of the carriers discontinued them because no one could afford them. I still would go with the HSA approach for the tax savings.

Please post back on what you decide to do with the client and if you keep them. Someone comes in with the HSA approach you might lose them.

 

[Consultant]

ABC:

1. Hi! Don't be offended about losing your clients money in that last instance.

2. It's an honest mistake. You sound like your in Palin / Biden debate dancing around the subject and talking shop instead of talking the point.

3. 7.5 AGI rule is not soley an HSA issue. It applies to his current plan as well.

3. H.S.A. is too much risk exposure. I told them to keep the Mass. Group Indemnity until cobra exhausts. I told him he can sleep well knowing he has done his due diligence. Moreover, I offered to become his son and get on the plan because the plan is non-existent in CA.

4. He was so happy finally understanding what he had even though paying $20,000 a year in premium. He has given me his brothers number that has a mid-size business. Called him this morning and going to do a BOR because he didn't want to look at anything till his renewal which is fine.

5. The original prospect and I have put an exit strategy in place a month and a half before cobra exhausts which consists of dropping those psychologists. (His son tried to commit suicide a few times.) The psychologist agrees that he only needs at most one more year which is within Cobra.

6. What group plan has a family OOP of 2,000. Show it to me. I want to be shown this plan. Are you in CA? Remember, a single person in a family HSA must meet the family OOP. The only thing close in CA that I see is IFP. We're not talking IFP. Please enlighten everyone on this board that the whole family's worse case scenario oop. Oh, yes. Don't forget. We're also talking OON. EVERYONE WANTS TO SEE IT!

 

[Dave020]

Are you unable to find an HSA plan that has a lower out of network OOP max? In CA. do the embedded deductibles change when its OON claim?

Yes, generally about double the par provider OOP. For example, if the plan is say $3000/$6000 HSA, OON might be $3000/$10,000 something like that. On top of that the excess beyond NFR is soley the subscriber's responsibility.

 

[Consultant]

Yes, generally about double the par provider OOP. For example, if the plan is say $3000/$6000 HSA, OON might be $3000/$10,000 something like that. On top of that the excess beyond NFR is soley the subscriber's responsibility.

TOP CA GROUP HSA Carriers: UHC, BS, BC, Aetna, HN.

Average Family OOP in OON is 20,000.

Plus,

My favorite plans you could be faced with both In and Out of Family OOP's. Total being $30,000 (10,000 In, 20,000 Out). Plus everything above UCR. :T

FACT: OOP's are lower in PPO than HSA in regards to family policies. I am not saying why again because I don't think brokers want to believe it.

 

[ABC]

UHC has embedded deductibles Anthem has them also. I don't know the CA market but I have to believe embedded deductible plans are available.

When it comes to the OON claims the way its coded can can effect the OON co insurance. Some plan designs have OON Co insurance from 50% to 0% with in the same plan.

In my state you can have an embedded deductible where the OOP max applies to one person in the family.
So if we have a $1,500 single deductible/ $3000 family
only the single deductible has to be met on any one individual for the insurance to kick in. So with that plan design your out of network single deductible is $3,000. Now where it can get harry is on the OON co insurance. I would recommend looking for a plan that has different % of co insurance for OON claims.
Then you can have the client work with the doc to code the claim in the correct category.

The $2,000 OOP example was where I got an OON claims coded as in network because of state mandates.

I have a handful of groups that are very small and have chronic health conditions. The HSA embedded deductible approach has worked the best. It has reduced the health premiums by over 30%. Then when you add up what they spend on health care on one family member it saves money.

I lose money on groups like this because of all the service that is involved. I take them because it leads to referrals.

Mental health cases can be very difficult because of the nature. Most plans for small group at least in my state have a max benefits on mental health claims.

 

[J.R.]

FACT: OOP's are lower in PPO than HSA in regards to family policies. I am not saying why again because I don't think brokers want to believe it.

I would like to hear you explanation. I'm not a broker, so I could care less