National Healthcare Reform Magazine by Employer healthcare Congress

National Healthcare Reform Magazine

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

EDITORIAL Editor-in-Chief

Jonathan Edelheit

ADVERTISING SALES Info@HealthcarereformMagazine.com

PRODUCTION Graphic Designer

Tercy U. Toussaint

For any questions regarding advertising, permissions/ reprints, or other general inquiries, please contact: Info@HealthcareReformMagazine.com

Health Risk Assessments: A Waste of Time and Money by Lisa Holland

CONTENTS from the Editor 04 Letter Healthcare Reform a Welcome

or Unwelcome Anniversary ? by Jonathan Edelheit

05 Remaking Healthcare in Georgia by Archil Undilashvili, Brian McCotter and H. Kenneth Walker

Future of the Affordable 08 The Care Act by David Goldstein

Healthcare Reform is a 12 Why “Perfect Storm”

Consumer Directed Healthcare Rescues Medicaid by Lisa Holland And Gregory J. Hummer

by Kevin Seeker

16 “Medical Loss Ratio” Optimization

by Dr. Suman

The Environment of Change by Neil Treitman and Mache Seibel

Reform Anniversary of a Scary Baby by Mark Roberts

Copyright © 2011 Healthcare Reform. All rights reserved. Healthcare Reform Magazine is published monthly by. Material in this publication may not be reproduced in any way without express permission from Healthcare Reform Magazine. Requests for permission may be directed to info@HealthcareReformMagazine.com. Healthcare Reform Magazine is in no way responsible for the content of our advertisers or authors.

National Healthcare Reform Magazine

EDITOR’S LETTER

Healthcare Reform a Welcome or Unwelcome Anniversary ?

e just passed the one year anniversary of the Healthcare Reform law on March 23, 2011. I think the question everyone is asking is where do we stand with healthcare reform. People are still shaking their heads and asking what it means, how parts of it will be interpreted and what changes will occur because of negotiations between Republicans and Democrats, and where do we stand since two courts found the law unconstitutional but many found it to be constitutional. Unfortunately there is no special insight because I believe no one really knows what is going on, especially up in DC. In fact, Anthony Weiner, a democrat in the House of Representatives, and one of the biggest supporters of healthcare reform is now looking to get a waiver so that New York City doesn’t have to comply with certain mandates of healthcare reform. He actually said ”maybe New York City can come up with a better plan.” This example of a big proponent and supporter of the law now trying to get out of it for his constituents is just an example of the bigger problems healthcare reform faces in the future. The real problem we face, is we still need true healthcare reform, which this law did not provide.

Jonathan Edelheit

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Remaking Healthcare in Georgia Written By Archil Undilashvili, Brian McCotter and H. Kenneth Walker

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

hile many of the world’s first ladies travel their countries to spotlight pressing issues, the first lady of the republic of Georgia, Sandra Roelofs, went abroad last month to raise awareness about her favorite cause: transforming Georgia’s healthcare system. With her help, Georgia convened a high-level discussion in Washington, D.C., between international healthcare professionals and doctors from the Georgian diaspora that spotlighted important, universal lessons about moving from authoritarian histories to democratic futures, and from central economies to market ones. Citizens of nations going through this transition to freedom consider access to healthcare an inalienable right. Georgia’s two-day forum demonstrated the importance that improved medical care can play in building support for a country’s democratic reform -- and will continue to play in Georgia’s evolution as a model for transformation in post-Soviet nations and elsewhere. It’s painful to recall what Georgia was like in the early 1990s: no electricity in winter time, corrupt traffic police shaking down motorists, no functional banks (let alone supermarkets), and a once-reliable central healthcare system that was underfunded and failing. A general feeling of post-Soviet malaise pervaded the population. But uplifted by the Rose Revolution in 2003 -- led by a Westerneducated modernizer, President Mikheil Saakashvili, Roelofs’ husband -- a new generation of young leaders has revitalized the country, society, and people. In the process, inefficient, centralized state health facilities were privatized, underwritten by the growth of the private health insurance industry. Individuals who live below the poverty line now have their healthcare paid for from public funds but provided by private insurers. New hospitals and clinics are slowly replacing old, deteriorating facilities. Today, while most of the former-Soviet Union continues to struggle with autocratic rule and resource dependency, Georgia has transformed itself into a functional democracy with a

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

market-oriented economy, and the accompanying success in delivering health services to the people has helped consolidate support behind the transition.

residency training at Emory; eighteen Georgians have received Master’s Degrees in Public Health; and we have organized bilateral exchanges of seventy-five medical students. Emory faculty have collaborated extensively with Georgian Amid this achievement, much remains to be colleagues in AIDS and tuberculosis programs, the done if Georgia is to provide modern, cost- introduction of emergency medicine to Georgia, effective healthcare to its citizens. The current and most recently a nurse training and education medical school curriculum was designed in project that upgraded the skills of 1,000 nurses. the 1930s and has evolved little since. While Georgian physicians are trained superbly in the What’s needed now is a clear vision of where fundamentals—their physical diagnostic skills Georgia’s healthcare system should head, and benefit from clinical examination that has been a long-range plan for how to get there. We and discarded in more modern medicine—they many others from the Washington forum are eager have no access to modern technology, and they to help generate such a strategic plan and look to cannot use the clinical data that forms the core the government of Georgia to lead the effort. of medicine in developed countries. Continuing education -- a vital requirement for physicians It is time once again to take the energy and courage and nurses -- does not formally exist in Georgia, that resurrected a downtrodden nation and focus it so there is limited opportunity for improvement. on reenergizing the reform of Georgia’s healthcare Because of outdated Soviet models, some essential system. We have no doubt that through this specialties, including emergency medicine, do not process, other countries moving towards greater exist. Nursing is in a similarly dire state; in fact, democracy will continue to find inspiration in the there are more physicians than nurses in Georgia. example Georgia sets. This is where Mrs. Roelofs comes in. The forum she hosted sparked a dynamic debate of ideas about how to harness the energy, resources and commitment of Georgian doctors in the Diaspora, government officials in Tbilisi and stakeholders in the United States to improve healthcare in Georgia. There is a model for this sort of engagement. Since 1992, Emory University -- and more recently, Partners for International Development, the non-governmental organization that implements many of Emory’s international programs -- has worked with Georgian partners to improve the healthcare sector, with assistance from the United States Agency for International Development (USAID). Fifty physicians have received

Bio Dr. Archil Undilashvili is the

Director of International Programs in the Department of Medicine at Emory University and Director of Partners for International Development

Brian McCotter is a Board

Member of Partners for International Development (PfID) and an international development consultant.

Dr. H. Kenneth Walker is

Professor of Medicine at Emory University and Executive Director of Partners for International Development (PfID)

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

The Future of the Affordable Care Act ~ Foreseen Challenges and Implications for Insurance Companies and Medicare Patients Written By David Goldstein

he Affordable Care Act will have numerous effects on the healthcare industry. Most notably to insurance agents, brokers, Medicare and Medicaid patients.

of their premiums on medical care. If they fail to hit the 85% mark they will be required to offer rebates to their enrollees. For small groups the percentage for the rule is 80%. One major effect that this is going to have on the industry is going to be the commissions for agents and Healthcare Reform & Insurance brokers. They will no longer be receiving the Companies same commissions they have in the past as many may move to a one-time fee setup instead The Affordable Care Act (ACA) has meant big of in the past what they have seen which could changes for premiums. Large groups with 100 have been a few hundred a month. or more enrollees must now spend at least 85%

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Insurance companies will see a drastic change to their current commissions. These regulations are going to cause many people to lose their coverage as some insurance companies will be forced to shut down. These plans, called limited or ‘mini-med’ plans are lower cost plans which don’t provide enough coverage to be considered ‘essential benefits’ under the new law. The effects will be a lack of coverage and higher premiums. The elimination of these plans will lead to a lack of competition resulting in an increase in premiums and many without coverage. However, the Department of Health and Human Services (HHS) can provide a one year waiver to those plans whose elimination will cause a major disruption in their market. In simple terms, a major disruption means a significant increase in premiums or a

significant decrease in access to care. Currently about 900 companies covering 2.4M people or 2% of all those with employer sponsored coverage have received waivers from HHS to remain in business. Shareholders will be upset so the company will raise the cost of premiums to make up the difference. Another interesting point to note is that the ACA has placed a new tax on executive pay

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

to all those who work in the health insurance industry. Specifically, insurance companies will no longer be able to deduct the payroll costs of executives who earn over $500k a year. This means that the first $499k can be deducted but any earnings thereafter will be taxed at the full rate. On the surface, this may appear as a way to keep costs down; however it will most likely have the opposite effect. The likelihood of finding a CEO willing to run a billion dollar company for less than $500k a year is very rare. Instead, that person would use their skills and talents in other companies where they will make more money. As a result, insurance companies will pay these folks what the going market rate is for CEOs (well over $500k a year) and will incur a big tax hit for doing so. This of course will affect their bottom line; to offset that, the companies will raise the cost of premiums to make up the difference. Ultimately, it will be the purchasers of health insurance who end up paying for the extra payroll tax. There is currently 1 Geriatrician for every 2,700 Americans over the age of 75. A major benefit for patients resulting from the ACA is that nobody can be denied coverage or care. In 2012, no matter how sick one is or how much cost they’ve incurred, they will have access to care. The law further mandates that those who are sick cannot be charged more than those who are healthy. As great as this provision is, it unfortunately removes the power of incentives which will create an economic inefficiency. Meaning there is no longer a financial reward for becoming less sick and therefore requiring less care and thus less cost. Yes, the ACA does impose a fine to those who do not purchase health insurance, however those fines or penalties will be much less than the cost of health

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

coverage. Since the ACA mandates that insurance premiums must be equal, insurance companies will have to raise the rates of the healthy to match those of the sick.

The Effects on Medicaid Many states are on the verge of bankruptcy due to the effects of the Great Recession. One of those in particular, high unemployment, is taking its toll on Medicaid. The reason is that as people have lost their jobs, they’ve also lost their health insurance leaving with no choice but to join their state’s Medicaid program. To help alleviate some of this burden, part of the 2009 stimulus package provided short-term cash to the states, however much of that cash is now drying up. As a result, 33 governors recently wrote to members of Congress as well as the Obama Administration asking for relief from many of the health care related federal mandates. For example, in California, Governor Jerry Brown is asking to cut $1.7 billion from his state’s Medicaid program by limiting the number of visits to a physician to 10 per year. Likewise, Arizona Governor Jan Brewer is trying to cut 280,000 people from their Medicaid rolls. These states simply cannot afford to continue in this manner. To make matters worse, more and more physicians are not accepting Medicaid patients. Because they get paid so little and are burdened with tedious paperwork, many of these doctors just don’t feel that it’s worth their time. The problem further intensifies when an additional 16 million people will be added to the Medicaid system per the ACA. Without an extra capacity of providers, existing Medicaid patients will have to compete with new enrollees to get access to physicians. Most likely, these patients will continue using their local hospital’s

National Healthcare Reform Magazine

emergency room, which is costly to the system and inefficient for both patients and hospitals. Unless changes are made, in 2019 there will be 84 million people on Medicaid rolls costing $900 billion a year.

Medicare Donut Hole Starting this year, the ACA will begin closing The Medicare Donut Hole, the portion of prescription drugs that Medicare beneficiaries must pay for. For instance, there are minimal out-of-pocket expenses on the first $2,800 for prescription drugs, then the ‘Donut Hole’ kicks in where the individual is on the hook for the next $3,600, and then relief kicks back in for all medications going forward. For those who hit the donut hole in 2010, they will receive a $250 rebate from the government. In addition, Medicare patients this year will also receive a 50% discount on brand-name drugs in the donut hole. The goal is that this donut hole will be completely closed by 2020. Another benefit of the ACA is that it eliminates all co-payments for preventive services to all Medicare patients.

Medicare ~ Access to Care

A growing concern for Medicare patients is in finding a physician who is willing to treat them. Since the cost of running a doctor’s practice is increasing significantly and the payments they receive from Medicare is decreasing rapidly, many doctors are no longer accepting Medicare patients. In fact, about 25% of seniors looking for a primary care doctor are having trouble finding one that will see them. The timing of this is unfortunate as this year marks the time when the first of the 75 million baby boomers turn 65 and thus start joining the Medicare system. If left unchanged, this will have severe consequences as the baby boomer generation has more health problems than other generations in the past. In fact, if

this continues, Medicare will become insolvent by 2030 as more money will be required to be spent. Another problem Medicare patients are finding is that there are less and less qualified primary physicians and geriatricians. The reason is simple; doctors in these specialties make less than those in other fields. If these trends continue, there won’t be enough people properly trained to take care of an aging population. According to the American Geriatrics Society, there are now 7,000 board-certified Geriatricians in the US. That is 1 for every 2,700 Americans aged 75 and older. It is estimated that by the year 2030 this ratio will drop in half to 1 Geriatrician for every 5,500 seniors.

Conclusion Even though it is difficult to see exactly what the Affordable Care Act will mean for insurance companies and Medicare patients it is clear that lots will change over the next few years. It will be interesting to see how insurance companies will adjust without large commissions and what the system is going to do to prepare for the large number of seniors entering into Medicare.

Bio

David Goldstein, President

of Health Options Worldwide (HOW), has extensive experience in the healthcare industry. HOW delivers a tailored network of global medical facilities within our technology platform to engage employees into bettering their health as well as reducing overall healthcare costs. For more information visit Http://www.HealthOptionsWorldwide.com or contact David.Goldstein@healthoptionsworldwide.com .

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Why Healthcare Reform is a

“Perfect Storm” How Voluntary Benefits can Provide a Crucial Lifeline

Written By Kevin Seeker

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

LR’s, Cadillac Plan taxes, grandfathering, higher deductibles and co-pays all are, increasing costs and premiums.

Somewhere in this swirling chaos, there are some solutions that can help all involved: employers, employees, and their brokers, agents and consultants. After all, everyone is on the same surging wave, struggling to make sense of it all – and in need of a lifeline like Voluntary Benefits. Let’s examine the raging storm – and some solutions – from various perspectives: Employers As employers deal with rapidly rising health costs and burdensome regulations, balanced with keeping employees satisfied with their benefit plans, here comes the Patient Protection and Affordable Care Act (PPACA). Not only does this legislation create additional confusion, it also causes many employers to brace for additional increases in their expenses, driving them to introduce Consumer Driven Health Plans (CDHP) along with Health Savings Accounts (HSA) to avoid excise taxes -- or to drop health benefits completely. Employees As confusing as this is to employers, think of how employees must feel as they contemplate increased out-of-pocket costs in the form of premium contributions, higher deductibles and co-pays. Even with HSA’s (which may or may not be subsidized by an employer), there are still gaps in coverage, which can impact their overall financial wellbeing. Statistics show that the majority personal bankruptcies are due to medical expenses, even though more than 70 percent of people had medical coverage in place. Brokers, Agents and Consultants As employers search for a beacon in the storm, intermediaries are also threatened by PPACA’s strong undertow and rip currents. In the small group market, there is growing concern about the impact of Medical Loss Ratios (MLRs)

National Healthcare Reform Magazine

on fully insured plans, resulting in lower – or no – commissions. This could deliver a devastating blow, especially if there are no plans for additional product lines to offset this. Fee based consultants are also facing revenue pressures. Organic growth is down, and competition is fierce. Clients are demanding more value-added solutions, and often at the brokers’ expense. Without additional revenue, this model can be difficult to sustain.

Enter the Lifeline ~ Voluntary Benefits Although Voluntary Benefits cannot completely stem the rising tide, they have entered the mainstream of employee benefit plan design strategies and can offer valuable solutions for everyone. Here’s how: Employers As employers grapple with balancing new costsaving strategies with employees’ financial wellbeing, they are considering products, such as Group Critical Illness and Group Accident plans, which have gained momentum because they:

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

• Help plug the gaps in coverage without being “underlying coverage”, when HSA compatible. • Do not impact the so-called Cadillac Plan excise tax issue. • Are valued by employees, which may help increase adoption rates of CDHP elections. • Leverage wellness benefits, by increasing health awareness and participation inherent in corporate wellness programs. • Send a positive message to employees, while also lowering employer costs. Employees Instead of going under the surging wave in the storm, employees can better protect themselves and their assets (i.e. their savings, HSA’s and 401k plans) with voluntary benefits that: • Provide valuable supplemental coverage. • Offer cash when it is needed most to retain control of the situation and to help offset many of the incidental expenses. • Are available on a simplified or guarantee issue basis, making them easy to enroll in and qualify for. • Include valued family coverage.

National Healthcare Reform Magazine

• plan.

Enhance the overall value of the benefit reduce it if the employee completes the test. In essence this pays for the plan).

Brokers, Agents and Consultants You can offer your clients a port in the storm, by introducing some of these types of voluntary benefits: • HSA-compatible products, like Critical Illness and Accident Plans, which can help offset some of the employee risk and alleviate some of the employer concerns about higher deductibles. • Newer generation products, like GAP and Hospital Indemnity, along with Critical Illness and Accident Plans, which provide excellent plan design strategies that help plug the holes. • Wellness benefit riders that are included in Critical Illness and some Accident plans, which help to drive participation in testing, thereby enhancing long-term savings. For Example: Employer funds $5000 of Critical Illness for each employee (with a Voluntary Employee Buy-up Option that includes a wellness rider), under the condition that they will fund the base plan IF employees complete testing. Employer also raises employee contribution, but agrees to

Voluntary Benefits can also include commission revenue. In many instances, commissions can now be level, providing a more predictable revenue stream and fit nicely with traditional group product compensation structures. In the small group market, consider what adding two Voluntary Benefit products like Critical Illness and Accident can do to your revenue stream. In lager case markets, Voluntary Benefit commissions can often be redirected to offset employer fees, or to use towards additional value-added services such as online benefit administration. For fee-based consultants, this can be significant in riding out the storm of shrinking organic growth. While we all weather the same “perfect storm”, Voluntary Benefits are rapidly gaining acceptance as a sound product set to be integrated into welldesigned benefit plans. Catch the wave and show your clients the advantages of Voluntary Benefits.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

â&#x20AC;&#x153;Medical Loss Ratioâ&#x20AC;? Optimization Another Reform Bullet Writen By Dr. Suman

round the country there is a deep concern. With an exponential rise in the medical cost do the consumers of healthcare get a high valued coverage for the money that they pay to their insurers towards accessing care services? As an answer to this long standing question- The PPACA (Patient Protection and Affordable Care Act) directed MLR (medical loss ratio) mandate seems to assure the Americans that now the bulk of the premium dollars spent towards the access of healthcare services are no more going for bureaucracy, profits and executives pay but, will be incurred towards providing them with quality care services. A failure to achieve the mandated thresholds (large group insurers to spend at least 85 percent of premium on medical care and quality efforts, and small group and individual plans to spend at least 80 percent of premium on medical care and quality efforts) will further bind their payers in offering them substantial rebates.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

But, this may not be the endâ&#x20AC;Ś. If one deep dives into this concept, the unaddressed minimum MLR requirement might even lead payers to experience compromised revenue margins, gross administrative inefficiencies, reduction in market shares, drift in the enrollment curve, rise in premiums, budgetary constraints to support reform centric capital business projects and even challenges to offer better product and services. Such numerous unfolded implications will ultimately make payers (both short term aggressive and long term strategist) to change their operational model and way to compete in this market. Certainly, commercial and government payers alike have been long looking for ways to stem the amount they spend towards their administrative functions (like payment reviews, broker commissions etc). However, within an existing complex fiscal environment the recent challenge to attain the directed MLR threshold is never going to be

National Healthcare Reform Magazine

an easy-to-fix problem. This new playbook needs to be dealt with a comprehensive approach such that Payers can scrutinize to cut their overhead administrative costs, invest more in quality medical services and simultaneously achieve higher margins within a minimum MLR environment. Focus should be on adopting processes and methodologies or streamlining the existing operations in a way that brings down the cost involved in enrollment, brokerage, claims adjudication, provider credentialing, contract negotiation. Simultaneously these processes/ methodologies should help in improving the utilizations of the care services, preserving functions like protocol-based clinical services, tracking of the hospital readmissions and unwanted procedures performed, reducing the instances of fraud and abuses etc, all that will result to a operational cost prohibitive but quality optimized business function. Payers also have to understand and adopt

the right strategic model to approach and engage consumers evaluating the correlations of factors that indicates how one of them is more amenable to an intervention than another. This can only be accomplished by leveraging some very refined data mining, predictive analytics and modeling tools that helps to transform information into strategic assets facilitating better decision making, building a competitive advantage through appropriate financial delegations for quality care services. Agreed, that this is not an unattempted task by health plans. But what remained unaddressed is the actual ability to bring...share information and establish the best practices, identify the right cohort, and create the communication so that right action is taken at the right time and the overhead cost that is spent in handling the unwanted situations through executive interventions are rationalized. All of that was missing; needs to be addressed today for the mandated MLR.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Payers must begin to understand the financial and operational ramifications MLR will have on their organization. Traditional business models will require reevaluation, as redefining medical spending to make the mandated percentiles attainable is just one way insurers might adapt to this new legislation. Additionally, there is also a need to assess each of the existing pricing levers that will help to reduce their operational cost, use any triggers that will help them in understanding the preventive action needed to be implemented to offset the implied impacts of the law, monitor any metric that will be an indicator for their MLR non-compliance and will require further investigation or invocation of an immediate action plan. The intention will be to create the right mix and balance of services which in long term will allow in controlling the potential trend in the growth of administrative cost - finally building a quality care incentive, sustainable, consumer centric, competitive business model. Realizing that the potential premium refunds kick starts this year, it is essential that plans begin to understand and strategize to address the short term and long term impacts of this requirement.

Bio Dr. Suman is a clinician

with Masters in Healthcare Administration with over 5 years of experience in medicine and Healthcare IT domain. He comes with extensive insight on US Payer & Provider Industry. His expertise lies into the development and implementation of IT-enabled business solutions for health payers and providers related to HIPAA 5010 migration, ICD10 transition & EMR. He is currently engaged as a domain expert in the iTransform Product development team. He has credits in authoring white papers & point of views related to HIPAA 5010 & ICD-10 transition. He is an active associate with NCPDP, AHIMA & WEDI SG for 5010 & ICD-10.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

The Environment

of Change

Written By Neil Treitman and Mache Seibel

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

he events and rhetoric leading to the inauguration of President Obama swept the mindset of the Nation in a tsunami of healthcare changes - to embrace healthy lifestyle changes and changes in attitudes that shift the responsibility of employee wellness to their employers. Why? Because the cost of high cost claims are causing the employer contribution to employee health insurance to soar. Employee wellness will lead to a more productive work force and lower healthcare cost. A Google search for the phrase “environment of change,” reveals article after article on issues in need of transformation such as global warming and atmospheric pollution. Glaringly absent was anything related to creating a safe and supportive space to encourage employees to make behavioral changes that lead to better health – the “human environment” that leads to the betterment of the human condition.

in manufacturing, service or employee wellness must fully embrace that initiative and make it part of the corporate philosophy and values. In practice, what that really means is that all employees must ultimately accept the offering as both positive and necessary and value it as a personal benefit. It is not enough for management to talk about changes, they must model it; and when observed in the workforce, reward and celebrate it.”

So recognize that making the decision to change when nothing is changing around you is difficult. The decision in itself can cause stress. Posters in the lunchroom or an occasional postcard from your health insurance provider will be ineffective if there is no noticeable awareness of the process of behavioral change. The key in evoking participation is to reduce the stress associated with making the decision to move toward better health by developing a new corporate culture. Those companies that While we rightfully are concerned with the are most successful create a new social norm that environment in which we live, we are neglecting embraces a healthier lifestyle. It begins with the the environment in which we spend the second reduction of stress. most abundant amount of our lives – the work environment. The environment we work in has both Is there really additional stress in making a decision the power and the potential to either enhance or that is good for you? In 1958, J. V. Brady, the detract. To stimulate or inhibit the essential elements pioneer in behavioral psychology, conducted a that motivate our employees to step out of a lifestyle study in which a monkey was strapped to a chair that has become too familiar, and begin to embark for six hours a day. During that time the monkey on a new decision tree that can lead to a healthier would receive an electric shock sufficient to be and more productive life. To contain your healthcare uncomfortable, but not physically harmful to the costs you must create an environment of change; monkey. The shock was automatically administered and one that makes it easy for your employees to to the monkey every 20 minutes unless the monkey adopt a plan of action. pushed a large red button placed within its reach. If the monkey stayed alert and made the decision The administrators of a company create the work to press the button at least once every 20 minutes, environment. Just as they set the example for the monkey avoided the shock. The experiment work, they must set the example for health in the continued for three weeks, six hours a day. The work place. Employees will in turn follow the monkey died. Upon examination, the researcher example of leadership and become attracted to found that the cause of the monkey’s death was an what is comfortable. Jim Gyurke, Vice President of ulcer. The experiment was repeated with a second Marketing and Sales of PAR, Inc. the world leader in monkey and at the end of three weeks, the second psychological testing says, “Any company that hopes monkey also died which also was found due to an to successfully implement a new program, whether ulcer. The assumption was that the electric shock 20

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

the condition that caused the monkeys’ deaths. Brady repeated the experiment again with a modification. This time he placed two monkeys side by side. One monkey had the button that could be used to avoid the shock. The other monkey did not have a button. The experiment continued for another three weeks until one of the monkeys died. Which one? The “executive monkey,” the monkey with the button. The companion monkey that was shocked but was not repeatedly forced to decide whether or not to push the red button remained healthy and happy. Brady concluded that the monkeys who developed the ulcer died because they had an extremely stressful job.

routes around the campus or neighborhood that should take 15 to 30 minutes at a casual pace. You’ll be amazed at how liberating and stimulating your meetings will be. 2. Encourage stretch breaks. Ergonomics are often not ideal and many of the sub- acute injuries treated in private practice stem from repetitive physical stress in the workplace. Not from lifting in the warehouse as much as headaches and neck pain from people who sit at their work station for hours with no break. An excellent reference for low cost remedies is Pete Egoscue’s book titled “Pain Free at your PC.” Backs were meant to be straight; heads and backs aligned.

Mitigating stress may be as simple as taking “the straps” off of the chair and promoting 3. Offer help and simple tools for time movement around the office. Here are some management that cause people to get up and ideas: move, like a calendar or to-do list on the wall. While technological improvement seems very 1. Meetings in motion-When two or three cool, it can sometimes become a time drain that team members need to meet face- to- face, creates “virtual straps” that bind people to their encourage that meeting to occur outside. Suggest chairs. w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

4. Keep schedules flexible enough to accommodate emergencies or changed work requirements. Allow time for exercise during the work day. Adding 15 minutes to lunch can provide the needed time for a walk.

seem a huge departure from your current work environment and a potential risk. But consider the potential gain - containing rising healthcare costs without cutting benefits. People seldom make lasting changes without some external stimuli. Changes in how we eat, cope with stress, our physical activity, 5. Yoga classes or simple exercise classes self-talk or relaxation activities can all lead to better incorporated into the lunch hour or work day as a health and result in lower claim costs. But to be 30 - minute â&#x20AC;&#x153;in houseâ&#x20AC;? fitness and stress reduction lasting, the environment must support that change, program that becomes part of the day. and the employer must be willing to set the example. The influence of leadership is an extraordinary Incorporating these and related approaches might resource as leaders

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

are in the position of authority and power that dictate rewards and sanctions, shaping employee behavior. It has to start at the top. Be aware of how your behavior affects the employee’s behavior. They are looking to you as the example.

measures to mitigate them. Because people are different, the greatest success comes from providing a variety of options available. When leadership sets the example through participation, the employees are much more likely to participate..

So what about those rewards? Invest in your employee’s wellness and offer incentives to ensure participation. Not every reward is expensive; recognition goes a very long way. The idea of celebrating an individual’s performance by recognizing their accomplishments is often more effective than their rebate for joining the gym.

Cambium’s team of experts comes from diverse fields. We examine medical claims by codes and procedures. Using this approach, we determine your company’s potential to realize a savings on healthcare costs by offering alternatives to traditional treatment protocols. Our unique method of analysis is the first step in working together to create a customized plan for your company’s needs that leads to sustainable At Cambium Wellness, our job is to analyze a cost containment. These tools are the basis of company’s healthcare expenditures and design developing a Cambium Wellness Program. The effective programs to contain costs. We ask a lot “diagnosis” is reached, the problems identified and of questions and when we ask the percentage of the solutions made simple and actionable. We help management’s participation in the company’s you identify those areas for cost reduction first, so wellness program, the answer is usually surprisingly you can reinvest the savings in an expanded approach low. We design executive programs and have to better educate and motivate your employees. This developed ways to analyze each individual’s interest approach ultimately can lead to a lower incidence of to promote participation. To contain healthcare cost disease, and reduce unnecessary medical visits and it’s essential to first understand the trend that leads claims for both acute and chronic conditions. to your company’s high cost claims and institute

Bio Neil Treitman is the President of

Cambium Wellness. Mr. Treitman followed his entrepreneurial instincts in 2001 after 25+ years of success in the real estate development industry to pursue an undeniable trendworthy shift into studying healthcare prevention and wellbeing. As a wellness coach and neuromuscular therapist, he pulled together a team of multi-specialty professionals to create a company that offers a solution to corporations nationwide for programs that increase the health of employees and decrease the cost of rising healthcare claims, crippling the overhead of both small and large businesses.

Dr. Seibel is a Professor at

the University of Massachusetts Medical School. He is author of 14 health related books, over 200 scientific articles and consistently listed in Best Doctors in America. He speaks internationally about health and wellness. Dr. Seibel founded www.HealthRock.com to help America stay well. He serves as Medical Consultant to Cambium Wellness. You can find more about him on www.DoctorSeibel.com.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Health Risk Assessments: A Waste of Time and Money Written By Lisa Holland

hen an employer is interested in beginning a wellness program the first thing that comes to mind is the implementation of a Health Risk Assessment (HRA). After all, an HRA has been introduced by the wellness community as one of the foundational data collection tools necessary to ensuring program success. The fact is an HRA is a needless investment that consumes employer resources, costs employers an enormous amount of money (i.e. incentives) and provides no meaningful data that would drastically change the fundamental health issues facing employers today.

A Health Risk Assessment (HRA) is a selfreported survey comprised of at least 15 to 45 lifestyle and behavior questions. The tool asks individuals pertinent health questions as well as questions about an individualâ&#x20AC;&#x2122;s family medical history, readiness to change, mental health and personal safety. The HRA outcomes are meant to support and assist employers with targeting health risks of their population so that they can use this information to craft a wellness program strategy. Employers are committing tremendous resources via benefit and human resource professionals in terms of implementation campaigns and monetary resources for incentives to attract participation.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

In most instances, even with a linked incentive, aggregate data. employee participation is limited and the aggregate results provide the employer with no 2. Self-funded employers have access to real value. all of their non-identifiable employee medical, pharmacy, workerâ&#x20AC;&#x2122;s compensation and other The following factors substantiate the notion that related data points that can be compiled and HRAâ&#x20AC;&#x2122;s provide little value and offer employers analyzed to provide a real snapshot of employee significant rationale for eliminating an HRA medical trend. This data can be extrapolated from their wellness program strategy: in order to target, design and implement an appropriate wellness strategy that will impact 1. The 2008 Genetic Information and Non- the health of the employee population. Disclosure Act (GINA) legislation prohibits employers from asking pertinent family history 3. HRAâ&#x20AC;&#x2122;s are self-reported tools. As such questions in an HRA when the employer links the reliability and validity of the outcome data is incentives to HRA completion. Family history questionable. Generally, the best way to validate can be an important piece of information that HRA data is to include biometric screening can support medical trend forecasting of a in conjunction with an HRA campaign, then population. The elimination of these questions crosswalk the outcome data against the employer significantly reduces the value of the outcome medical trend reports. This method

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

improves validity but adds administrative burden HRA. Employers can achieve a successful wellness and costs more because the employer now must fund program through a Consumer Directed Health incentives and biometric screening. Plan and appropriate biometric monitoring without spending additional dollars, exasperating your 4. Lastly, there is significant and readily benefits team and annoying employees. available data that concludes that roughly 75% of About Simplicity Health Plans all chronic disease can be prevented or delayed by changing certain lifestyles and health behaviors. Cleveland, Ohio - Simplicity Health Plans is the Additionally, the CDC continues to release alarming best implementation of a CDHP/HSA. It aligns evidence on the obesity epidemic in the United the interests of the Employer, Employee and the States. This information alone assists employers Provider to provide a turn-key, fully integrated with easily targeting interventions and programs Consumer Directed Health Plan. It also delivers a without the use of an HRA. low cost, scalable solution to control claim costs. The Plan fuses unparalleled technology, point of There is no need for employers to spend thousands service adjudication, real-time data, and first of of dollars on HRA campaigns and incentives to its kind anti-fraud controls. Services include an achieve a successful wellness program. So what ERISA compliant health plan, HSA administration do employers really need to begin their wellness and banking, medical claims administration, TPA program? The answer is simple, implement a functions, pharmacy, dental & vision, COBRA, stop Consumer Directed Health Plan (CDHP). loss reinsurance, real-time Utilization Review and Case Management, Health Coaching, Comparison A consumerism model is “wellness by design” and Shopper, Health & Wellness programs, and a host of has proven to promote health and change individual on-line tools for Providers, Employers and Members. health behaviors by as much as 25%. Secondly, initiate health campaigns that address the “Big Three”; diet, exercise and tobacco cessation. These three factors address the 75% of today’s chronic disease. By targeting these critical health factors employers will Lisa M. Holland, RN, begin to impact population health trend and support MBA has been in the healthcare employees with achieving optimal health and wellcare industry for over 18 years being. To monitor and measure program success and held senior level positions use the following biometric screenings: Cholesterol within the largest healthcare (full lipids), Body Mass Index, Blood Pressure and organization in the US. Lisa’s Nicotine screening (Tobacco Use). Each of these professional objective is to use her knowledge and measures contributes directly to the total health of expertise to encourage and promote the appropriate an individual. When these measures are maintained utilization of healthcare services and solutions within established clinical ranges optimal health that empower healthcare consumerism and impact can be achieved and chronic disease and illness national healthcare affordability. Yo may contact can be prevented, ultimately equating to improved Lisa Holland at 401-487-1450. population health and healthcare affordability.

Bio

Don’t waste another day or another penny on an

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

Consumer Directed Healthcare Rescues Medicaid Written By Lisa Holland And Gregory J. Hummer

t is impossible to pick up a newspaper or log on to Google without reading about how many States are struggling to meet their budgets. Not surprisingly their State dollars are being consumed by healthcare costs and their representative Medicaid programs. States like California and New York must contemplate major healthcare decisions in order to slice their budgets and maintain State integrity. Many States are seeking interventions and attempting to develop innovative ideas to address the chronically ill components of their Medicaid programs when in fact, they should be addressing the acutely ill services which constitutes

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

anywhere from 50-60% of the Medicaid healthcare spend. The reduction in the use of inappropriate acute care services holds the most immediate cost saving potential and could save State Medicaid programs billions of dollars in healthcare cost which could then be shifted to other Medicaid programs (i.e. nursing home programs), thus offsetting the escalating costs for caring for the chronically ill recipient. In the meantime, the recipients who have been misusing and/or inappropriately accessing the acute care services will be educated and informed about how to engage responsibly in the healthcare system. They will begin to improve or maintain their current

National Healthcare Reform Magazine

health status and access quality care. The solution is simple, consumerism—an effective and efficient health benefit design that has been proven to reduce healthcare spend and actually change individual health behaviors by as much as 25%. In addition to healthcare savings, individuals learn how being healthy will actually save money and translate into personal wealth—money that can be used to pay for their medical care and retirement.

The typical Medicaid “consumer” has learned to depend on the system to determine their medical course of action for themselves and their families with little regard for what is appropriate in terms of individual health needs. While we want these individuals to have access to quality care, we also want these individuals to understand their involvement in their personal care and that they have a responsibility to make appropriate healthcare Medicaid is a State and Federal Government funded choices that make the most sense and tha are cost healthcare program that supports lower income effective and are evidence-based. families, children as well as disabled individuals and individuals in long-term care facilities (i.e. The average Medicaid encounter from acute care nursing homes).Medicaid systems do not empower service generally accounts for about 50-60% individual users of the system to be accountable or of Medicaid funds. For instance, in the State of responsible for the personal well-being, and thus California $18 billion dollars of State funds alone inappropriate utilization of acute healthcare services are spent on acute care services. Lastly, the FBI continues to eat away at state and federal budgets estimates that about 9-10% of the money being which fund these programs. The Medicaid system spent on Medicaid is fraudulent and is unnecessary. is flawed because it lacks the following mechanisms that will ultimately control costs: The Medicaid system is archaic and needs to be transformed into a program that educates and • No incentives to drive personal wellbeing empowers the recipients’ of acute care services (Healthcare accountability and responsibility) to become accountable and responsibly engage in the healthcare system to become long-term • Lacks rewards for wellness behaviors conscientious healthcare consumers . Through • Lack of technology to reduce/eliminate accountability and responsibility, the real acute administrative burdens care medical needs of families and children can be achieved, utilizing Medicaid funds more effectively • Does not drive engagement in preventive and efficiently. Additionally, recipients are rewarded care services for responsible health behaviors resulting in an • Highly bureaucratic and administrative increase in preventive care services and lifestyle burden (unattractive to most providers) choices that promote optimal health and wellbeing. • Limited Provider access related to low reimbursements A Medicaid consumerism program is an innovative • Lacks educational tools/resources to reduce/ and bold move that will address the current misuse eliminate dependency of the Medicaid acute care system. By readdressing the way the acute care payments are deployed to • Lacks fraud controls resulting in an estimated recipients in such a way as to use an innovative point9-10% of State budget per year resulting in of-service payment system that uses the Internet billions of dollars in fraud.

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

in conjunction with a consumer oriented approach and plan design that serves to build wealth for a portion of each State’s current Medicaid recipients. A Consumer Driven Healthcare Plan with a Health Savings Account will accomplish the following: • Greatly reduce fraud by at least 3% per state per year • Continue to reduce fraud by another 6-7% for ongoing programs • Introduce a Medicaid consumerism reward model that provides incentives to recipients for engagement in preventive services • Reward adoption of healthy lifestyles that promote and sustain well-being • Enable recipients to save real dollars to be used for current medical costs and for retirement • Eliminate unnecessary claims administrative cost burdens • Introduce rapid payment to providers while eliminating their cost of billing and collection • Enable improved choice and greater access to more providers due to a simple rapid payment system. A consumer directed healthcare plan that uses a sophisticated technology system will accomplish the proposed elements. In addition, the system can adjudicate, clinically edit and re-price a medical claim at the point-of-service. The software system uses the Internet and has the following core attributes:

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

• Internet based • Easily accessed via a secure web browser • System uses standard 128 SSL encryption for all transactions • Ability to provide real time eligibility data • Real-time online photo identification of recipient (anti-fraud) • Enables PIN security for both recipient and provider • Enables bill entry within 45 seconds • Display the price to be paid to recipients and provider

• Provides an account with an interest rate of 1.2% regardless of balance • Enables the recipient to review their claims online • Enables the recipient to communicate online to their health coach or MCM • Enables the recipient to communicate online to the provider • Provides consumerism tools for cost comparison • Provides automatic screening test reminders and rewards engagement in preventive services

• Require sign off by recipient or guardian

• Provides an online method to request a medical case management plan

• Adjudicate all line items to the health plan coverage

• Ability to search for a provider accepting the plan

• Apply instantly most all CMS, CPT or special edits to bills

• Enables direct ACH payment to providers for a better discount

• Re-price each line item to a fee schedule OR

• Provide an “Advance Account” – a Government fund to help pay the balance of any short fall within the recipient’s HSA account for services rendered

• Offer a reduced amount for rapid payment direct to provider bank account • Enables the complete integration of banking with the claims system • Enables payments from a recipients HSA t to the provider by ACH • Enables the recipient to view detail of their HSA • Enables the recipient to view a graphic image of the balance over time • Provides an account with no banking fees

• Enables aggregation of funds for payment from recipient HSA and Advance account for payment by ACH to provider A radical move must occur within the Medicaid system if recipients of this government funded program wish to continue their access to subsidized healthcare. It is no longer acceptable, nor palatable, that these recipients continue to be dependent upon the government to fund their inappropriate acute care services. A cultural shift that provides solid healthcare education which supports an informed and accountable healthcare consumer is

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

now required in order to save the Medicaid program.

the health and well-being of Medicaid recipients who misuse and/or inappropriately access the acute care service system. Medicaid consumerism fosters healthcare responsibility and accountability that will lead the way for individual long-term health and at the same time provide a savings mechanism that will allow continued funding for programs that address the chronically ill.

Healthcare consumerism can be achieved at any level. We are in an age of information and technology and everyone has access to the internet. Accountable and responsible healthcare consumers are more likely to engage in healthier lifestyle, use self-care techniques, use generic drugs and consider all aspects of care (quality, access and cost) before appropriately engaging in the healthcare delivery system. About Simplicity Health Plans A Consumer Directed Health Plan with a Health Savings Account will support healthcare affordability by design. It will use the power of the internet to eliminate the complexities of administration, point-of-service payment to engage the physician and health saving accounts that will empower recipients to be in control over their personal health spending; in a responsible manner that will equate to personal wealth and savings for the future. This structure does not currently exist in the Medicaid model today.

Cleveland, Ohio - Simplicity Health Plans is the best implementation of a CDHP/HSA. It aligns the interests of the Employer, Employee and the Provider to provide a turn-key, fully integrated Consumer Directed Health Plan. It also delivers a low cost, scalable solution to control claim costs. The Plan fuses unparalleled technology, point of service adjudication, real-time data, and first of its kind anti-fraud controls. Services include an ERISA compliant health plan, HAS administration and banking, medical claims administration, TPA functions, pharmacy, dental & vision, COBRA, stop Medicaid is bound in a history of entitlement and cost loss reinsurance, real-time Utilization Review and Case burden. As healthcare and healthcare spending continue Management, Health Coaching, Comparison Shopper, to spiral out of control and States are being forced to Health & Wellness programs, and a host of on-line consider slashing healthcare dollars for chronically tools for Providers, Employers and Members. ill programs, it is time that Medicaid takes a bold and daring move to foster individuals within the Medicaid system to understand that personal health and wealth can be achieved through healthcare accountability Lisa M. Holland, RN, MBA has been in the healthcare care industry and responsibility. Consumerism has proven its value for over 18 years and held senior level within the private sector and has demonstrated 15-17% positions within major healthcare in medical savings alone. These same savings can be organization in the US. Lisa is an used to save Medicaid. accomplished business development

Bio

Consumerism must be embraced by State and Federal funded programs now in order to continue to provide services today for the chronically ill who are beyond prevention and rehabilitation. State Medicaid programs will save billions or more a year while improving

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

professional. Lisaâ&#x20AC;&#x2122;s professional objective is to promote appropriate utilization of healthcare services/solutions that empower healthcare consumerism.

Gregory J. Hummer, M.D., has spent the last 18

years developing and perfecting Simplicity Health Plans to solve the vexing complexities, out-of-control costs, burdens and inefficiencies that are associated with healthcare coverage in America today. Dr. Hummer is chairman and CEO of Simplicity Health Plans.

National Healthcare Reform Magazine

Reform Anniversary of a Scary Baby Written By Mark Roberts

ow that the Healthcare Reform Act has celebrated its first birthday, Americans are getting a good look at what this new baby is shaping up to be as it prepares for the toddler stage over the next couple of years. Like any newborn, the PPACA has given its caretakers a fair share of sleepless nights, bouts of chronic fatigue, and worrisome healthcare issues. Like any other baby, the Act has been learning as it grows, with new lessons every day from the administration who birthed it. Guarding its ongoing health has been a challenge as well, with outsiders who would see it harmed or overturned with a good spanking. All things considered, it’s one scary baby. According to Kaiser Health News, a year after Democrats in Congress pushed through the law overhauling U.S. healthcare, Americans remain as split as ever about it. Forty two percent of Americans support the health law while 46 percent are opposed. Although both figures were down slightly from

February, overall they have changed little since President Barack Obama signed the landmark bill into law on March 23, 2010. The law, which will supposedly extend coverage to 32 million Americans, has come under a blistering attack from Republicans in Congress who are trying to repeal it and Republican governors who have filed suit seeking the Supreme Court to declare it unconstitutional. Not surprisingly, public opinion of the law varies along partisan lines, with 71 percent of Democrats supporting the law while 82 percent of Republicans oppose it in the latest survey. Of those who oppose the law, 20 percent say they are most concerned about its costs, 19 percent are worried about the government’s role and 18 percent don’t like the law’s mandate that individuals get coverage. The public also remains as confused about the law today as it was a year ago: About 53 percent of Americans said they are confused, the survey found. That is even more widespread among the uninsured

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

and low-income Americans – the groups who have the most to gain from the law, particularly when most coverage expansions take effect in 2014. About six in 10 in these groups report a lack of understanding. Senior citizens, the vital voting bloc that gained several new benefits in the Medicare program from the law, remains the most skeptical age group, with 52 percent opposing the law. About 39 percent of seniors believe Medicare will be worse off under the law, compared to 19 percent who think it will be better off. The health law extends the solvency of the Medicare Trust Fund by 12 years, gradually closes the gap in coverage in the Medicare prescription drug benefit and eliminates Medicare co-payments for many preventive services. Republicans have raised concerns about cuts in the growth of Medicare payments to hospitals and other providers that finance the law’s coverage expansions and reductions in payments to Medicare health plans under the law that could result in reduced benefits. So, it appears that a law that has always been controversial is even more confusing to Americans than before it was passed. Plus, the “education” thrust from the White House have not helped the average American much. Apparently, after a year, there is still some confusion over the most sweeping piece of legislation to come from Congress since the Declaration of Independence from Britain. A recent poll by Politico indicates that close to half of Americans are working with either a false understanding of the status of the PPACA or are confused. People do not understand the over 900 pages of legislative language that is the PPACA. Even governors and presidents are having a hard time understanding exactly what it says, according to The Insurance Barn. The idea that it has already been repealed is misleading. The administration will veto any bill about repealing the Patient’s Protection and Affordable Care Act. As long as he remains president, it will take 2/3 of both houses of congress to override his veto. That is not likely to happen in the next 2 years. Unless the law is declared

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

unconstitutional by the U.S. Supreme Court in 2012 it will remain law. The only realistic chance for it to be repealed and replaced is if the congress and president are replaced in 2012 with people who are against the PPACA. If that does not happen, the remainder of its provisions will go into effect in 2014. Most of the changes that will affect you have either already gone into effect or will happen in 2014. Most of the spending that the PPACA authorized over the next 3 years is directed towards the states and not individuals, according to The Insurance Barn. It is tax payer’s money, given to the states, to prepare for the big changes to health insurance that will arrive in 2014. At that time, unless there is a modification made, the PPACA requires every citizen and legal resident of the U.S. to purchase health insurance approved by the Secretary of HHS. Those people who do not obtain health insurance from their employers will purchase their health insurance through state or federally run purchasing exchanges. Until they are operational, people will have to continue to obtain their health insurance information the exact same way they do now, from the exact same sources. Except for some minor changes to “preventive medicine” the average working adult has not seen the benefits of the PPACA and will not be affected until 2014. Then there are issues that also concern employers. According to Inside Counsel online, The Patient Protection and Affordable Care Act (PPACA) will impose new restrictions and requirements on employers and employee benefit plans. According to a new report from Ernst & Young, many U.S. employers believe that managing the changes resulting from healthcare reform is a critical business issue, but few organizations have fully analyzed how the new law will financially impact them. Many employers are confused about whether their health benefit plans are “grandfathered” (exempt from new coverage requirements) and the effects if their plans lose their grandfathered status. The healthcare

National Healthcare Reform Magazine

reform law is already affecting executive employment agreements and severance arrangements. PPACA’s new rules for the first time will prevent employers from discriminating in favor of highly compensated employees in the administration of insured health plans. Consequently, employers will no longer be able to offer to pay for continued health coverage or pay COBRA premiums for departing executives, even though this had long been a standard component of many CEOs’ severance packages. Given that Congress has not yet appropriated funds to implement PPACA, the confusion over its effect may continue well into 2011, according to Inside Counsel. Just as the economy is starting to look up, building

service contractors are being faced with a challenge just as frustrating as the recession. This, too, has the potential to impact profits, according to Contracting Profits. The provisions of PPACA that became effective in 2010 include no lifetime limits on health insurance, no co-pays or deductibles for preventive services and extension of coverage for dependent children until age 26. Despite the good intentions of the law, most people felt that the healthcare system wasn’t broken in the first place, and now, employers are getting hurt. What has happened, in anticipation of legislative healthcare becoming effective, is we’ve seen insurance premiums go up. Some policies have gone up as much as 20 percent. Employers are already seeing that instead of

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

National Healthcare Reform Magazine

their bills going down, they’re going up. Those in the health insurance industry are seeing increases in health insurance rates, according to Moody Insurance Worldwide. Despite the perception that brokers make lots of money on accounts, they really make only three to five percent of the premium paid. When the carriers cut commissions, it affects the bottom line. It will cause a lot of brokers to go out of business. There is talk in the industry that the insurance broker’s commission may be cut out completely. The only way they can continue to work with clients is to charge a fee to the insured on their own. Clients may lose out on getting the best renewal options if they bypass brokers to work directly with insurance companies, she adds, as brokers do a lot of administration work and help solve problems with claims, billing and enrollment. Unionized employers, especially, are paying attention to PPACA and the political drama surrounding it. In addition to getting updates from trade groups and associations, brokers and accountants are valuable sources of information. Insurance brokers have to keep abreast of the law and accountants have to be aware of the tax consequences of non-compliance. So those groups of professionals, in particular, seem to be tracking the law with almost an obsession. Lawyers, too, who specialize in labor and benefits law are also tracking this on a daily basis, according to Contracting Profits. The PPACA will likely undergo significant changes this year, based on rulings from HHS. The business community can only hope those changes will prevent their costs from increasing even more. And the States are going to take a major hit along with taxpayers, according to Health Plan Week. The health reform law will cost state taxpayers at least $118.04 billion through 2023, according to a report released March 2 by House and Senate Republicans during a House committee hearing on Medicaid and state health reform. While fewer than 5 million individuals used Medicaid services in the program’s first year, today nearly one in four Americans is enrolled in the program, according to the report. Over the next decade, the federal

w w w. H e a l t h c a r e R e f o r m M a g a z i n e . c o m

government will spend $4.4 trillion on Medicaid. At the state level, Medicaid spending consumes nearly a quarter of state government budgets. The National Governors Association quantified that crisis at a collective $175 billion budget shortfall through 2013. The report offers a state-by-state breakdown of likely spending on Medicaid between now and the end of the decade. Man, that’s a lot of cash to take care of a new baby. As the healthcare baby grows, watch out for tantrums. Employers, consumers, and brokers must keep a sharp eye out for any changes. Some of those may stink, but working within the law sometimes does. Business is never easy, and the business of healthcare has definitely changed.

Bio Mark Roberts’ professional sales

background includes almost 30 years of sales and marketing in the tax, insurance, and investment markets. Currently his key focus is developing relationships with large national client groups, including insurance plans, employers, unions, affinity groups, and associations, and financial institutions in various areas of responsibility including sales, marketing, and account management. Mark also is a licensed life, health and accident insurance agent in all 50 states and DC, and has participated in multiple large national employer open enrollments for voluntary products including limited medical benefit plans, short term disability, term and universal life policies, cancer and critical illness policies, and many other insurance products. Additionally, Mark has been writing a healthcare blog for the past 3 years, found at www.yourbesthealthcare.blogspot.com , which is a topical weblog about various healthcare issues. He has been noted recently as the Medical Reporter for an online news service with over 110,000 subscribers at www.thecypresstimes.com , and he has been pleased to regularly contribute articles to magazines for both medical and dental topics both in the US and the UK. You can reach Mark at markr@careington.com or by phone at 800-441=0380, x2905.