Update to the forum members. YAgents (Bill) and I are digesting the email, an attached 2 page "broker guide" that says about the same thing, and another UH1 email I received 2/25/2013 with an imbedded video about the issue. Some of their premises are pretty weak, like their claim that Obama's promise after the Supreme Court that you "can keep your health plan" is the basis of this. They use a lot of wording like "might", "may be able to", and "most likely". So, let's see if we can get it confirmed by your/our best carrier reps, and maybe some legal sources before we assume that "renewable health plans" can just keep their current client book. Personally, I'll bet the carriers will try everything they can to keep the book in position by making as few changes and as little rate increase as possible. And I'll bet HHS will want them to do so, because it lessens rate shock-and-awe, and open enrollment meltdown.
Total Meltdown at Insurance Companies
- Thread starter taterpeeler
- Start date
- 8,448
Hi Dan, it's not about being able to sell the policy(s) for this company after 1/1/2014. It's about keeping the book of business in tact.
Instead of going through the expense and aggravation of dealing with HHS's mandates, the company feels they will have more to gain by simply pulling out of the health market, keeping health customers in their current plan (anticipating 75% retention), and focusing on their non-health insurance products.
Companies smaller than let's say AETNA or HUMANA, understand that they can't financially, or in resources, compete against the "big boys" either on, or off of the exchange in the 2014 environment. As we know, even the biggest carriers, like United Health Care, are no longer eager to play in Obama's briar patch, so you can imagine how smaller companies are desperately looking for ways to keep what they have, come 2014.
-Allen
This flies in the face of traditional block underwriting, trending and pricing.
A closed block (no new entrants) will by definition deteriorate. Carriers need new policyholders in that block to keep the rate level viable.
That frozen block will get older and sicker. Life span on these blocks under "normal" situations usually tops out around 8 years after the policy series is discontinued.
This is different as most of those in a closed block cannot move due to health issues. The only ones that leave are those who simply cannot afford the policy any more, they die or secure other coverage (group, Medicaid, Medicare).
Frozen grandfathered blocks will deteriorate much quicker since there will be options, including (for some at least) subsidized premiums.
I still say grandfathered plans have a 3 yr life expectancy.
Because they don't know.
I met with a regional VP for a major carrier last week. He said there are still a lot of unanswered questions, and HHS keeps changing their mind. It might be June or so before they stop tweaking everything and carriers have a clear(er) idea of what 2014 plans will look like.
He estimates carriers will have 90 - 120 days to get the final plans priced and approved at the state level.
Good luck on that.
Also said the actuaries are working overtime coming up with new scenario's.
For sure, HHS wants as few people buying subsidized plans as possible, but the carriers will not be able to sustain older policies long term for reasons stated above. Added pressure from HHS over "unreasonable rate increases", even with minimal changes to 2014 style plans, will still make these plans explode.
- 1,896
That's a good point - what happens if individual states don't approve plan designs and/or rates in a timely fashion? Many carriers now talk about how it takes 12-18 months to get something approved, and we're looking at 6 months currently, maybe as low as 3.
In GA BX has already filed new plan designs matching what they believe will be the design for 2014 and the design has been approved. To be ready for HIX and 2014 they will simply need to file rates (assuming their design meets HHS guidelines).
I don't know, but I suspect KP has done likewise or is very close to getting approval.
The other carriers are waiting on more clarification from HHS on design.
It is entirely possible there will only be 2 carriers here ready to rock enroll come 10/1.
That should be interesting.
I don't know, but I suspect KP has done likewise or is very close to getting approval.
The other carriers are waiting on more clarification from HHS on design.
It is entirely possible there will only be 2 carriers here ready to rock enroll come 10/1.
That should be interesting.
I'm not a health expert by any means, so what happens to companys like Security Health Advisors/Freedom Life? Will they just all of a sudden dissapear?
- 8,448
Here's one of their recent press releases...
USHEALTH Advisors Shows No Signs of Slowing its Record-Setting Growth Trajectory
ObamaCare might very well lead to their demise. It's a shame, right when things were starting to really turn around for their beleaguered company.
- Thread starter
- #29
I have a theory.... follow along.
I have heard these rumors of Time guaranteeing rates until the end of 2014.... I have also read on here and other sources that if a block is "dead" it does not have to conform there by providing lower rates for plans.... ok, your set up, not the theory:
There is one big medicare supplement company that will change the name of the company every now and then. example, today in your state it's united of Omaha but in 5 years they may change the name to a sister company like mutual of Omaha or one of the other handful of companies they own there by "closing" the block and starting over..... whats to stop Assurant from doing this? they are Time insurance now... don't they still own fortis? in my 20 years they have been , Assurant, fortis, time, john alden... all the same basic company..... they have a track history of doing this.
they could pop up on Jan 1 2014 as Assurant offering compliant plans or healthy access (happy allen?) and the old block sits there slowly dying..... just a thought
I have heard these rumors of Time guaranteeing rates until the end of 2014.... I have also read on here and other sources that if a block is "dead" it does not have to conform there by providing lower rates for plans.... ok, your set up, not the theory:
There is one big medicare supplement company that will change the name of the company every now and then. example, today in your state it's united of Omaha but in 5 years they may change the name to a sister company like mutual of Omaha or one of the other handful of companies they own there by "closing" the block and starting over..... whats to stop Assurant from doing this? they are Time insurance now... don't they still own fortis? in my 20 years they have been , Assurant, fortis, time, john alden... all the same basic company..... they have a track history of doing this.
they could pop up on Jan 1 2014 as Assurant offering compliant plans or healthy access (happy allen?) and the old block sits there slowly dying..... just a thought
If they do that, there are just 3 plausible reasons:
1) They prefer to strangle to death slowly instead of dying quickly.
2) They have brilliant marketing plans to circumvent Obamacare, using one carrier to close shop and retain the block, choosing another carrier to market healthy access, choosing another carrier to market alternate plans from overseas possibly (Fortis is from Europe), etc.
3) They are desperate
1) They prefer to strangle to death slowly instead of dying quickly.
2) They have brilliant marketing plans to circumvent Obamacare, using one carrier to close shop and retain the block, choosing another carrier to market healthy access, choosing another carrier to market alternate plans from overseas possibly (Fortis is from Europe), etc.
3) They are desperate
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