The Death of the 100% Hsa

[ABC]

The death of the 100% hsa is coming. I spoke with two underwriter from two different national carriers and they both told me the same thing. That the HSA blocks are running very bad. Once people hit that deductible they think everything is free.

I see these plans being priced out of the market in the next 18 months. The 80% co insurance plans will take there place.

With the way the industry going its very possible we could see $5,000 single and $10,000 oop on groups under 20.

 

[moonlightandmargaritas]

With the way the industry going its very possible we could see $5,000 single and $10,000 oop on groups under 20.

OOP limits on HSA-qualified plans are determined by IRS regs, not the carriers.

 

[0b1kanobee]

What is not covered once they hit the deductable? Doesn't it depend on their plan and carrier what's covered and what isn't?

 

[ABC]

OOP limits on HSA-qualified plans are determined by IRS regs, not the carriers.

IRS reg are one thing but the reality of how these plans are running is another.

What is not covered once they hit the deductable? Doesn't it depend on their plan and carrier what's covered and what isn't?

Most HSA 100% plan once you hit he deductible everything else is covered. So if you have a $2,500 deductible and you hit that you pay for nothing else for the rest of the year.
So it takes the consumerism out of the picture.

 

[0b1kanobee]

OK so I am missing something being new.......doesn't sound bad to me so what exactly is the problem in terms I can understand?
Also in your first post you said that people think they cover 100% and you just said they do cover 100% so what is your point?

I'm new but not stupid I just am not following you.

 

[somarco]

There is something terribly wrong with that logic. The OOP limit is still the same on the higher deductibles.

Most HSA 100% plan once you hit he deductible everything else is covered. So if you have a $2,500 deductible and you hit that you pay for nothing else for the rest of the year.
So it takes the consumerism out of the picture.

But any treatment must be medically necessary. Large case management will get involved on most large claims so it doesn't matter if it is 80% or 100%.

 

[ABC]

OK so I am missing something being new.......doesn't sound bad to me so what exactly is the problem in terms I can understand?
Also in your first post you said that people think they cover 100% and you just said they do cover 100% so what is your point?

Here is my point, the development of the HSA plan was to create consumerism in the health services. Its not working because people are not being consumers because once the deductible is met everything else is free. Its not free it ends up costing the group in rate increases.

The initial HSA plans were suppose to yeild single digit rate increases for good years. This is not the case.

There is something terribly wrong with that logic. The OOP limit is still the same on the higher deductibles.

Not on 100% HSA plans. The oop is lower.
So these plans actually are better deals from an individual claims standpoint.


But any treatment must be medically necessary. Large case management will get involved on most large claims so it doesn't matter if it is 80% or 100%.

Even with case management people are having higher claims on the 100% HSA plans.


My advice to anyone prospecting and selling HSA on a group level. Sell the 80% co insurance plan. With the exception of shock claims that plan will run much better from a rate increase standpoint.

 

[0b1kanobee]

Seems to me that if this were the case then it would be a bad underwriting problem or something along those lines. Best I understand insurance so far is that the consumer hardly ever meets their deductable in either type of plan. Hence one of the selling points of an HSA. Are you saying lots of folks are now meeting their deductable?
Not that I don't believe you were told this but something doesn't sound right. I would be curious to see if their are any industry related articles on this and how many other agents concur with your findings.

 

[bluemarlin08]

I asked an underwriter several months ago why HDHP were seeing similar % rate increases as co pay plans and he gave me the same answer, much higher claims than anticipated. It;s not very difficult to justify say a colonoscopy, extensive cardiac workups etc.

 

[0b1kanobee]

I asked an underwriter several months ago why HDHP were seeing similar % rate increases as co pay plans and he gave me the same answer, much higher claims than anticipated. It;s not very difficult to justify say a colonoscopy, extensive cardiac workups etc.

Seems to me then that it is all relative. If you have an HSA plan that costs $150.00 per month and a traditional plan that costs you $200.00 per month and they both go up 30% in price then it would be relative with the HSA still being competitive????

Now if the monthly premium were the same for an HSA as a good traditional plan, wouldn't it make sense to have the traditional plan? Then I could see why you could see the death of the HSA. Am I seeing this correct here or what?