Per the law, prices must be the same in and outside exchange to avoid adverse selection. Which someone uses will depend upon income, expected income, and their willingness to have their info submitted to every gov't entity to check up their butt..
So What's Really Going to Happen to the Group Market
- Thread starter Crabcake Johnny
- Start date
Per the law, prices must be the same in and outside exchange to avoid adverse selection. Which someone uses will depend upon income, expected income, and their willingness to have their info submitted to every gov't entity to check up their butt..
- Staff
- #92
My sister works for a dealer and had to submit the paper work....said it was a pain in the ass and was glad it was over with....
- Thread starter
- #93
- 14,808
This country has never seen a catastrophe on this scale come 2014.
I can write a book on the flaws in this legislation but let's name a few:
1) There's no money to fund it. This is going to cost trillions in subsidies and no one's found the money, yet Sebelius is still behind the curtain pulling on the strings.
2) The worst thing that could happen is that it works. Millions pour into the exchanges and in a relatively short period of time. Administrators will be slammed and carrier claims reps will be curled up in fetal positions in their cubicles. PCIP didn't work because of the six month exclusion and people actually have to pay for it. Families earning 200% FLP will be able to hop on this puppy for $180 a month.
3) There's no money to fund it.
4) States that think they can administer this mess, can't and it'll be a completely enrollment and processing clusterf**k.
4) And if I didn't mention it, there's no money to fund it.
5) Healthy people who don't care about getting covered still won't care about getting covered. They'll be more than happy to pay the $225 fine. Carriers warned the administration that the only way GI on a national level can remotely work is with a lot of premium dollars from the young and healthy. That will not materialize.
I can write a book on the flaws in this legislation but let's name a few:
1) There's no money to fund it. This is going to cost trillions in subsidies and no one's found the money, yet Sebelius is still behind the curtain pulling on the strings.
2) The worst thing that could happen is that it works. Millions pour into the exchanges and in a relatively short period of time. Administrators will be slammed and carrier claims reps will be curled up in fetal positions in their cubicles. PCIP didn't work because of the six month exclusion and people actually have to pay for it. Families earning 200% FLP will be able to hop on this puppy for $180 a month.
3) There's no money to fund it.
4) States that think they can administer this mess, can't and it'll be a completely enrollment and processing clusterf**k.
4) And if I didn't mention it, there's no money to fund it.
5) Healthy people who don't care about getting covered still won't care about getting covered. They'll be more than happy to pay the $225 fine. Carriers warned the administration that the only way GI on a national level can remotely work is with a lot of premium dollars from the young and healthy. That will not materialize.
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- 7,790
With regard to the Small Group Market, I can sum it up by stating it's down the toilet!!!!
- Thread starter
- #95
- 14,808
Arn, businesses never should have got into the health insurance biz in the first place. It's as silly as getting my auto or homeowners through work. It was an extremely poor concept from get-go since there was never ownership of the policy. Portability has always been a flaw.
The entire group market need to go bye bye and leave large companies like GE to focus on airplane engines and medical technology.
The entire group market need to go bye bye and leave large companies like GE to focus on airplane engines and medical technology.
- 3,352
John: I agree with you on this...the entire structure was doomed from the start, people allowing their health insurance to be tied to an employer. 100% flawed and 100% correct.
However:
1. Didn't MA have CELTIC in their exchange? How did Celtic, a third world carrier, have the money to be in the MASS exchange? Or am I wrong, they were never part of it?
2. YAgents: Dead on analysis...Who is going to want to go through the nightmare of the IRS probing your family a$$ every year checking to see if you qualify for a subsidy, and do you owe the IRS money back? Who in the HELL is going to administer the freakin' subsidy paperwork? NAVIGATORS?
What a complete and total failure. And it hasn't even begun.
Again, whos signing people up and who is handling the paperwork? Logistically - IMPOSSIBLE WITHOUT AGENT INVOLVEMENT...and if there isn't proper compensation for agents do the work, its going to sink faster than a dude with concrete shoes.
However:
1. Didn't MA have CELTIC in their exchange? How did Celtic, a third world carrier, have the money to be in the MASS exchange? Or am I wrong, they were never part of it?
2. YAgents: Dead on analysis...Who is going to want to go through the nightmare of the IRS probing your family a$$ every year checking to see if you qualify for a subsidy, and do you owe the IRS money back? Who in the HELL is going to administer the freakin' subsidy paperwork? NAVIGATORS?
What a complete and total failure. And it hasn't even begun.
Again, whos signing people up and who is handling the paperwork? Logistically - IMPOSSIBLE WITHOUT AGENT INVOLVEMENT...and if there isn't proper compensation for agents do the work, its going to sink faster than a dude with concrete shoes.
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According to the same link you used above, the median number of people in a household has been 2.59 from 2006-2010. And 400% Federal Poverty Level is not $88,000 per family. It is $88,000 for a family of 4.
If the median is 2.59 people in a household, then let's look at 400% of FPL for that size of a family. For a family of 2 it is $60,520 and for a family of 3 it's $76,360. So, at least for a family of 2 making the median $52,000, they are very near the 400% mark, and as closely as I can calculate the subsidy it would be $1500 for that family.
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I agree with HealthGuy & YAgents that the health insurance purchase shouldn't be tied to your employment. In answer to the question of how it's possible to administrate this - no problem! On New Year's Day 2014, millions and millions of people will all switch insurance at the same time. Sure we will. It will happen. It will not be delayed, modified, delayed, tied up in court, delayed, amended, delayed... All carrier reps, all navigators and all agents will stay up all night long New Year's eve and take applications & subsidy proof. It'll happen.
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When system links into IRS, it will come back with your income, and the subsidy is automatically applied. If you dispute the income, you can change it online and adjust your subsidy. So, their is not subsidy paperwork, it's all online and auto credited. The problem will be income accuracy, and figuring out future income.
Navigators can find, educate, and facilitate enrollment, BUT, from a chart that I'm reading: "facilitating enrollment is different that performing actual enrollment of an individual into the appropriate program". So the navigator can do everything except help them fill out online app, talk about setting the client up for disappointment. I doubt navigators will have a license to sell outside the exchange
The other problem is funding the navigators. They can't use fed funds after year 1. Most states are having hard time coming up with a process of generating funds. They are thinking about charging insurers a fee to be part of the exchange, or charge each person enrolling a fee, or? I'm sure it will be positioned as being "free", making insurers pay for it, and then raising premiums
Navigators can find, educate, and facilitate enrollment, BUT, from a chart that I'm reading: "facilitating enrollment is different that performing actual enrollment of an individual into the appropriate program". So the navigator can do everything except help them fill out online app, talk about setting the client up for disappointment. I doubt navigators will have a license to sell outside the exchange
The other problem is funding the navigators. They can't use fed funds after year 1. Most states are having hard time coming up with a process of generating funds. They are thinking about charging insurers a fee to be part of the exchange, or charge each person enrolling a fee, or? I'm sure it will be positioned as being "free", making insurers pay for it, and then raising premiums
I found the documentation that says you may purchase a plan OUTSIDE the exchange and not be subject to the penalty under the individual mandate. See the Kaiser article and flowchart at The Requirement to Buy Coverage Under the Affordable Care Act - Kaiser Health Reform
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Also, in the NAIC document about exchanges, it says on page 7,
"Nothing in this title prohibits an insurer from offering insurance outside of the Exchange or eligible individuals and employers from purchasing coverage outside the Exchange."
http://www.naic.org/documents/committees_b_Exchanges.pdf
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And.... here is some excellent material from the Congressional Research Service about coverage INSIDE vs OUTSIDE of the exchange. This answers several of our questions.
Note that it estimates 24 million will take coverage in the exchange and 20 million will get subsidies.
Note on page 6 that it says an insurer selling inside the exchange must "charge the same premium rate for each qualified health plan of the issuer without regard to whether the plan is offered through an Exchange or whether the plan is offered directly from the issuer or through an agent"
http://www.nahu.org/legislative/resources/CRS_PPACA%20Requirements%20for%20Offering%20Health%20Ins%20Inside%20V%20Outside%20Exchanges_June%2010.pdf
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In helping you divide your book of business into "who will get a subsidy, who won't, and who's on the upper margin" sections, some of these points can help you analyze many of your clients quickly:
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Also, in the NAIC document about exchanges, it says on page 7,
"Nothing in this title prohibits an insurer from offering insurance outside of the Exchange or eligible individuals and employers from purchasing coverage outside the Exchange."
http://www.naic.org/documents/committees_b_Exchanges.pdf
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And.... here is some excellent material from the Congressional Research Service about coverage INSIDE vs OUTSIDE of the exchange. This answers several of our questions.
Note that it estimates 24 million will take coverage in the exchange and 20 million will get subsidies.
Note on page 6 that it says an insurer selling inside the exchange must "charge the same premium rate for each qualified health plan of the issuer without regard to whether the plan is offered through an Exchange or whether the plan is offered directly from the issuer or through an agent"
http://www.nahu.org/legislative/resources/CRS_PPACA%20Requirements%20for%20Offering%20Health%20Ins%20Inside%20V%20Outside%20Exchanges_June%2010.pdf
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In helping you divide your book of business into "who will get a subsidy, who won't, and who's on the upper margin" sections, some of these points can help you analyze many of your clients quickly:
- If they have a bunch of kids and middle class income, they'll get a subsidy.
- If they are very low wage earners whether single or not, they'll most likely get a subsidy or Medicaid.
- If they are double-income no kids, they probably won't get a subsidy.
- If they are single, they won't get a subsidy if they ages 20-35 at 301% of FPL and above. This is because the premium is so low at those ages that it doesn't cost them more than 9.5% of income.
- If they are a 2-member family, ages 20-35 at 340% of FPL or above, they won't get a subsidy.
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- Thread starter
- #100
- 14,808
HHS punted to the NAIC. They're working on refining the language as to exactly what navigators can and cannot do, then they punt it back to HHS.
Of course, I'm here to tell you as a statement of fact, that if unlicensed navigator can earn anything by "facilitating enrollment" there will be teams of 'em hitting the streets each day and the rules will be a mere inconvenience. Read up on ACORN.
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We're still back at the same place. If carriers have to offer the same coverage at the same prices/benefits outside of the exchange, but there's no subsidy then this only appears relevant to people earning over 400% of FLP.
Another great read: http://www.nahu.org/legislative/resources/Individual Mandate and Related.pdf
I must have missed the "free choice vouchers"
Some individuals will be eligible for a free choice voucher from their employer to help pay for
health insurance offered in an exchange. An employer who offers minimum essential coverage
and pays any portion of the premium must provide free choice vouchers to each qualified
employee.
12
A qualified employee is defined as an employee whose required contribution to the
employer plan, for self-only coverage, is greater than 8% and less than 9.8%
13
of the employee's
household income for the taxable year, whose household income is not greater than 400% of the
Federal Poverty Level (FPL) for the relevant family size, and who does not participate in the plan
offered by the employer. Beginning after 2014, the 8% and 9.8% will be indexed by the rate of
premium growth.
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