Category Archives: Health Care Reform

Employer coverage up under Massachusetts health law

Researchers argue PPACA could play out the same
By | May 13, 2013
If Massachusetts’ own health reform is any indication,
employer-sponsored health insurance will be safe under the Patient
Protection and Affordable Care Act.

In the seven years since Massachusetts enacted its universal health
care law, the number of people covered by insurance at work actually
increased, running counter to nationwide trends at the same time,
according to report Monday from consulting firm PricewaterhouseCoopers.

Opponents of President Obama’s health reform law have argued that
employers dropping health coverage for their employees will be one of
the big unintended consequences of the law that will hurt employees.

But Robert Valletta, PwC U.S. healthcare provider leader, argued that
“Massachusetts’ experience may offer clues into how health
organizations, the business community and individuals might react to
elements of the Affordable Care Act set to take effect in 2014.”

“Despite concern that the Affordable Care Act signals the end of
employer-sponsored health coverage, our analysis of the Massachusetts
experience paints a more complex picture,” Valletta said, noting that
each state and industry is different.

Employer-sponsored insurance rose about 1 percentage point in
Massachusetts while the national rate fell by 5.7 percentage points.

Researchers note the growth occurred despite the difficult economy, and at a time when premiums hit historic highs.

PwC’s Health Research Institute on Monday released the first of a
two-part series called “The Massachusetts Experience,” which examines
the real-world implications of health reform in the first state in the
nation to move forward with a broad expansion of coverage.

Massachusetts’ health law was implemented in 2006 by then-Gov. Mitt
Romney, Obama’s GOP rival in the 2012 presidential election. The law has
helped the state close the gap on uninsured residents; the Bay State
has the country’s best rate of insured individuals, with just a 4.5 percent uninsured rate, according to Gallup numbers.

President Obama has said repeatedly that he used Massachusetts’ state
health reform as a blueprint for his Patient Protection and Affordable
Care Act.

Researchers also said that employer-sponsored insurance is often financially beneficial to both employers and employees.

“Employer-sponsored coverage will continue to be a critical pillar of
the U.S. health system, and it has been an important part of employer
strategy to attract and retain talent, and promote improved health and
productivity,” said Michael Thompson, PwC U.S. human resources services
principal focused on health care.

Thompson said that health insurance benefits are unlikely to go away when PPACA goes into full effect.

“Most employers see this return on investment, alone, as a compelling reason to continue offering coverage,” he said.

According to HRI’s analysis, two key factors shaped the Massachusetts
experience: the individual mandate, which drove up demand for coverage,
and the tax implications for both employers and employees.

The second report on the Massachusetts Experience — which will take a
look at the implications for state’s hospitals, physicians and insurers
— will be released later this month.

What a 15-Year-Old Needs to Buy Plan B

By Venessa Wong
May 01, 2013 4:10 PM EDT

The Food and Drug Administration announced
Tuesday that it approved an application by Teva Women’s Health to sell
the emergency contraceptive Plan B One-Step to women (and men) 15 years
of age and older without a prescription. The product will also now be
available on store shelves rather than behind a counter. Teva is
redesigning the packaging to include anti-theft features and a UPC code
that, when scanned, prompts the cashier to verify proof of the
customer’s age.

Of course, most 15-year-olds don’t have driver’s licenses. How will
they prove their age? Not with a school ID—those are not valid.
Consumers need to present a government-issued ID, such as a state ID,
passport, or birth certificate, FDA spokeswoman Erica Jefferson says. A
Department of Motor Vehicles learner’s permit is also acceptable.
Some reproductive health advocates are concerned that these
requirements will keep Plan B out of the hands of many consumers who are
legally eligible. “This compromise doesn’t address the reality that not
every woman has a photo ID—especially women in urban areas who may not
drive and women aged 15 and 16,” Ilyse Hogue, president of NARAL
Pro-Choice America, said in a statement.

FDA and Teva declined to comment about this concern.

The drug retails for about $50. In 2011, the Department of Health and
Human Services directed the FDA to turn down Teva’s application to make
Plan B One-Step available over the counter to those aged 16 and
younger, despite the FDA’s recommendations.

Bracing for Obamacare, Some Businesses Try PEOs

ESCO Communications, an Indianapolis-based audio/visual equipment installer, has provided health insurance for its 100 employees
for more than 40 years, but when CEO Chip Roth was faced with 40
percent price hike on the company’s plan last year, he realized he
needed to make a change. The cost increase–coupled with expected
complexities of the Affordable Care Act, often referred to as Obamacare–led
Roth to WorkSmart Systems, a local professional employer organization
that pools health benefits for the employees of 200 small companies.
“Health insurance was the real driver,” Roth says. “By joining a
larger pool and spreading the risk around, we were able to keep our
rates the same as they were.”
With insurance premiums on the rise and health reform kicking into
high gear, many small companies are looking for strength in numbers.
Some are joining PEOs so they can provide a menu of affordable health
plans to their employees, and outsource the complex administrative tasks
associated with them. Matt Thomas, founder and president of WorkSmart,
says his company is on track to double its sales in the three years
ending in December 2015. “A lot of that has to do with the Affordable
Care Act,” he says. “Even larger companies that wouldn’t normally look
at PEOs are looking now, so they can avoid some of the ramifications of
[the law].”
PEOs, available for the past 30 years, provide health benefits and handle
human resources tasks, including payroll, workers’ compensation
insurance and other benefits. And because a PEO does all of this for a
group of companies, rather than just one, it can typically achieve
economies of scale that individual companies can’t. The most recent data
indicates that the sector is growing: PEO industry revenue reached $92
billion in 2012, a 13.6% increase over 2010, the year the health
legislation was signed into law, according to the National Association
of Professional Employer Organizations in Alexandria, Va.

PEOs generally charge a flat monthly fee per employee or paycheck, or
they take a percentage of each client’s total payroll. If a PEO does
its job well, it should generate enough savings for their clients to
offset those fees, says Jay Starkman, founder and CEO of Engage PEO in
St. Petersburg, Fla. “Insurance companies reward the aggregation of
[employees], so oftentimes PEOs are able to deliver a 5 percent savings
to their clients,” on health care, he says.

PEOs also say they save small companies the hassle and cost of hiring
their own in-house HR staff, who could cost more than $80,000 a year in
salary and benefits a piece. “A PEO does all the stuff that’s not
essential to your core business,” Starkman says.

There can be drawbacks to joining PEOs, however. Because a PEO acts
as a co-employer, you may feel as if you’re losing some degree of
control over your employees. And how competitive a rate your PEO gets
for health insurance will depend on the overall demographics and health
status of all the employees it is insuring–factors that are out of your
control and that will likely change over time.

A big reason PEOs are seeing a bump in interest these days is that
many small companies simply need help wrapping their brains around the
new health law, says Pat Cleary, CEO of NAPEO. All companies with 50 or
more full-time employees will have to offer health insurance, but the
intricacies of complying with the law can be hard to navigate. “The
perils and pitfalls that are in there for any small business are
significant,” Cleary says. “The biggest advantage, in my view, of going
to a PEO is to be able to say, ‘Figure this out for me.'”

Frank Romero, chief revenue operations officer of Evanston,
Ill.-based Grocer Exchange, a network of independent supermarkets, says
he’s more comfortable with health reform since he signed on with Engage
PEO in January of this year. “The owners of our supermarkets, which are
typically manned at a rate of 30 to 40 people per store, need this,
because they can’t afford to do this administration themselves,” Romero
says. “And the PEO brings to the table benefits savings that they could
never get themselves.”


Entrepreneurs considering a PEO can check out NAPEO’s website for a full checklist.

Whose train wreck is it anyway?

This is by far the best and most succinct article on the status of ObamaCare I have read in quite a while. – Reeve

By | May 1, 2013

By now, I’m sure you’ve heard about top Democratic senator Max Baucus predicting a “train wreck
coming for PPACA. In a budget hearing nearly two weeks ago, Baucus
expressed his concern that the exchanges for consumers and small
businesses wouldn’t open on time in every state. He also said the
“administration’s public information campaign on the benefits of the
Affordable Care Act deserves a failing grade.”

People worried about Obamacare’s implementation? Not a big surprise.
But a key author of the health legislation screaming about it in a
budget meeting? Not great for morale.

Recently, both HHS Secretary Kathleen Sebelius and President Obama admitted some flaws in the whole thing — Sebelius admitted
the law would cause higher premiums for some, while Obama just this
week said there will be “glitches and bumps” in the rollout of his
health care law.

This isn’t news, but just how much higher premiums will be and just how bumpy this ride will end up — those are the questions.

One thing’s for sure: the law is losing steam. Public opinion is no longer on Obama’s side: The latest Kaiser Family Foundation poll
found that a majority of Americans have a negative perception of the
law. In the latest tracking poll, 40 percent said they have an
unfavorable view of the law, compared with 35 percent who have a
favorable view.

Oh, but here’s the worst (I mean scariest) part about all of it:
Consumers still don’t get it. Like, they really, really don’t get it.

A staggering number of Americans — 42 percent — apparently didn’t
realize that the Supreme Court held a huge case on the constitutionality
of the law — and voted to keep it. Four in 10 Americans are unaware
that the PPACA is still law and is being implemented. Among them, 12
percent believe the law has been repealed by Congress, 7 percent believe
it’s been overturned by the Supreme Court and 23 percent say they don’t
know enough to say what the status of the law is.

There’s not much else to say besides that’s not OK.

It makes me ask: whose train wreck is this, really? Is it the fault
of the administration who passed and praised and pressed this law, but
haven’t been able to successfully control its implementation? Is it
Republicans who are too prideful for this to work, doing everything they
can to prevent the success of the law?

Or is the trainwreck due to the ignorance of Americans, who
apparently really need to pick up a newspaper or put on C-SPAN for a few

It’s a little bit of everyone. But without being embraced by each of
these groups, the PPACA won’t just be off to an imperfect beginning; it
will be a hot failure.

Insurers Display Reluctance To Sell On Exchanges.

Reeve Conover|may 7, 2013 |Article Compilation

An analysis piece published by NAHU,reports on the lack of interest shown by the nation’s
largest insurers to join the Affordable Care Act’s new exchanges, set to
begin enrolling people in October. According to the article, this means
that in many states, there will be no added competition, a central
tenet of the President’s law. Recently, the four largest US insurers
have signaled that they are unlikely to move beyond the areas in which
they already offer coverage, meaning they
will sell on fewer than one third of the exchanges.

In Illinois, the State estimated 16 carriers would sell 260 health plans on the exchange, but only 6 companies applied to sell plans, including new Co-Op Land of Lincoln Health, Aetna, United Health and Blue Cross Company Health Care Service Corp (HCSC).

Insurers are concerned, in part, that people who have expensive medical
conditions will sign up immediately for coverage through the exchanges,
while healthier customers will wait. That could leave an insurer, at
least initially, without enough premium revenue to handle the medical
bills it receives. They’re also concerned about how fees and coverage
restrictions mandated by the law will affect the profitability of their


Still, HHS remains confident in the ability of the exchanges to encourage competition and
lower prices. Spokeswoman Erin Shields Britt said, “Many people will
receive up-front financial assistance to make insurance more affordable,
plus many will be new or first time customers for insurance companies.”

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Reeve Conover is a Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/dealer member FINRA/SPIC. Cambridge and Conover Consulting are not affiliated. Licensed in SC, NC, NY, CT, NJ, and CA. - SIPC - Brokercheck