What About Becoming a Consultant?

[scagnt83]

I think that true HI consulting on a fee basis will be booming.
The big corporations have already been utilizing HI consultants to evaluate the effects reform will have on their company.

Larger and mid-sized closely held companies will be looking for this service as well; many already are.

Our firm has a separate benefits subsidiary for group benefits, and a true financial planning/consulting subsidiary solely for fee based planning, we also have a CPA on staff; we are already in talks with several companies about doing an independent evaluation of upcoming options with pending legislative reform.
(We already do independent fee based evaluations of 401K platforms for businesses)

By the time 2014 hits, im sure that there will be plenty of changes and things will be even more confusing.
An owner of even a small firm would gladly pay $1000 - $5000 for a true independent evaluation of options and to tell them exactly what the hell is going on.

If your knowledgeable of accounting/business principles and have the knowledge of the pending reform; imo it will be a field day for fee based independent evaluations....

 

[insurehound]

Interesting scagnt83.

 

[jbage007]

Those of you who think only people earning $80k+ will be purchasing outside the exchanges, I think there is more to it.

First, the subsidies themselves have been greatly oversold. They are in the form of TAX CREDITS, meaning people may have to pay the FULL PREMIUMS UP FRONT, then wait for a larger than normal tax refund. They are income sensitive so people whose income fluctuates can be in for a world of surprises.

To qualify for a subsidy at all people have to purchase inside the exchanges. Those premiums are going to be through the roof. Won't be uncommon for a family of 4 to pay $1200 a month for a freakin' health plan that is "gov't approved" - and IT may have a $12,000 family deductible.

THOSE people are the ones more likely to say screw it, and go outside the exchange for health plans they can afford sans a subsidy

That's my 2 cents.

As for the people making over $80+ they very likely will be the ones looking for higher quality plans - to a point of course.

Big question as I see it: Just how much coverage will people be able to purchase OUTSIDE the exchanges? Remember, they'll have to pay the "fine" in addition to their premium cost so the difference between that total and the cost of an exchange plan will have to be large enough to justify the purchase of a reduced benefit plan.

 

[Crabcake Johnny]

That's actually not how the subsidies will work. Just like the (now defunct) COBRA subsidy, the client only pays the reduced amount. they don't have to pay the full amount and wait until tax season.

 

[jbage007]

Here's a link that gives good details on the subsidies:

How subsidies work

These will be refundable tax credits and advanceable tax credits. Refundable tax credits are the kind poor people get - cash payments to people who don't pay taxes.

Advanceable credits are the kind used to fund COBRA (primarily). These are STILL SUBJECT TO INCOME at the end of the year which is the point I was trying to make albeit inartfully.

If you are claiming a subsidy based on a $40,000 income (say from last year) and your income zooms to $120,000 this year - you're going to be in for a world of hurt when you file your return. You'll have to refund the rebate!


Who is this likely to affect? Self-employed people and others whose income is subject to wild fluctuations.

You would STILL have the option to treat the tax credit as a post-filing credit - which will be safer for people in this situation.

Hope that helps to clarify. Sorry for the confusion.

 

[CHUMPS FROM OXFORD]

"Remember, they'll have to pay the "fine" in addition to their premium cost"

I did not know there was a fine for going outside the exchange. I thought the fine is for not having any coverage at all.

 

[scagnt83]

"Remember, they'll have to pay the "fine" in addition to their premium cost"

I did not know there was a fine for going outside the exchange. I thought the fine is for not having any coverage at all.

The fine is for not having a "qualified" health insurance plan.
I do not think that a plan has to be in the exchange to be considered "Qualified". (i could be wrong)
It will however be required to contain a minimum standard of benefits within the plan to be considered "Qualified".

 

[jbage007]

The fine is for not having a "qualified" health insurance plan.
I do not think that a plan has to be in the exchange to be considered "Qualified". (i could be wrong)
It will however be required to contain a minimum standard of benefits within the plan to be considered "Qualified".

Yeah, I think this is a BIG question.


IF - if it is possible to provide decent coverage outside the exchange, this could be a huge market.

Especially if normal underwriting were to apply.

Get it?

Then the exchange would just become a de facto high risk pool.

That's what leads me to believe that plans outside the exchange not only won't qualify for subsidies but also would trigger a fine - for not carrying health insurance.

Surely this will result in the mutha of all lawsuits.



But I dunno. Haven't been able to get a straight answer from anyone on this.

 

[scagnt83]

Yeah, I think this is a BIG question.


IF - if it is possible to provide decent coverage outside the exchange, this could be a huge market.

Especially if normal underwriting were to apply.

Get it?

Then the exchange would just become a de facto high risk pool.

That's what leads me to believe that plans outside the exchange not only won't qualify for subsidies but also would trigger a fine - for not carrying health insurance.

Surely this will result in the mutha of all lawsuits.



But I dunno. Haven't been able to get a straight answer from anyone on this.

I will have to go find documentation to back this up, but I was researching some over the weekend and a plan does not have to be in the exchange to be considered "Qualifed".

But there are lots of catches:
- The carrier has to have at least two plans (one at the gold level the other at silver) in the exchange for any of that insurers plans to be considered Qualified.

- The plan has to provide the "essential health benefits package" (basically a minimum level of benefits and services) that the bill out lines
(most all of these "essential" services are already standard in most HI plans).
But it includes other stuff to such as:
Marketing requirements
Sufficient provider choice
Inclusion of "essential" community providers who serve low income families
Be "accredited" (whatever the hell they think that means) for clinical quality, patient experience, consumer access, etc...
Have a "quality improvement" strategy
Use a uniform enrollment form
Use a standardized format to present the plan and its options
Provide info on quality standards used to measure plan performance
(and thats just what I can remember...)

- The plan has to apply to any and all regulation/requirements that the exchanges set forth (even if its not on the exchange)

- Here is the big catch (sorry to bust your bubble 007);
To be a qualified plan, the insurer must charge the same rates as they charge on the exchange.

So, basically this rule for "qualified HI plans" makes it impossible for insurers to create a separate lower priced plan (that is considered qualified) outside of the exchange.


My hope is that they can price the "non-qualified" underwritten plans with healthy risk pools low enough that it will still be cheaper to pay the premium and the penalty.

The penalty maxes out at $2,085.....

Take me for example. Im young (27) and have a 6 year old on my HI plan as well. I pay right at $270/month for individual coverage through GR/UH.
Im guessing that with the higher risks going to the exchange, a regular underwritten policy could very well be half (or maybe get 20%-30% off) of that for someone in my position...
So if I where to pay $2K for coverage, and a $2K fine; Im sure that I would still come out cheaper than going through the exchange....

Plus, I have not recieved a tax return in years now. And the only way for them to collect my fine is through a tax return... (they are not legally able to include it in taxes payable)
So im guessing there will be lots of people like me who will refuse to pay the fine; many will probably be willing to go to court over it...


But the exchanges are really designed for the self-employed, unemployed, or individuals at very small companies that cant offer HI.
The bill really pushes the burden of HI onto employers. But the problem is that it will be cheaper for employers to pay the fine for not having coverage than it will be for them to provide coverage and pay for at least 50% of that coverage as mandated by the bill....

So when all the big corporations drop their HI, the exchanges will be flooded (so will the requests for premium subsidies). And this is not something that was planned on. The CBO estimated only a minimal number of people actually using the subsidy...
If this happens, it will implode the whole exchange system...