Senior Insurance Blog

On March 23, 2010, President Barack Obama signed into law the Patient Protection and Affordable Care Act.  The new law brings much change to our health care system, and with that you will likely encounter many questions from your clients.  The following is a list of major provisions in the law that will impact many of your clients directly:

The Medicare “doughnut hole” will be closed - the approximately 4 million Medicare beneficiaries who hit the so-called “doughnut hole” in the program’s drug plan will get a $250 rebate this year.

No more co-pays for preventative screenings – to encourage earlier detection of health issues and treat them at a lower cost.

Extending the life of the Medicare Trust Fund - Health insurance reform will extend the life of the Medicare Trust Fund by an additional four to five years – and delivery system reforms included in health insurance reform have the potential to keep the Trust Fund solvent even longer into the future.

The Physician Payments Sunshine Act – requires disclosure of payments and gifts provided to doctors from pharmaceutical, biologic, and medical device companies.  This law aims to reduce medical costs for consumers by preventing conflicts of interest created by such financial incentives.

Medicare Payment Improvement Act of 2009 – health care providers will be compensated for their services based on the quality, not the quantity, of care they provide.  States that achieve higher quality-to-cost ratios will receive an increased reimbursement from Medicare.

The Nursing Home Transparency and Improvement Act – consumers will have more access to information regarding nursing homes’ historical record of care.  This increased level of transparency is meant to encourage nursing homes to maintain the highest quality of care by their own initiative.

The Patient Safety and Abuse Prevention Act – prevents individuals with violent or criminal histories from working at organizations that provide care to senior citizens.  This will be accomplished through a new system of nationwide background checks.

 
Retooling the Healthcare Workforce for an Aging America Act of 2009 - expands, trains, and supports all sectors of the health care workforce to care for the growing population of older individuals in the United States.

The Home and Community Balanced Incentives Act – provides states with financials support and incentives to encourage restructuring of Medicaid programs to allow for more individuals to receive home and community-based services (HCBS).

According to Joe Baker, the president of the Medicare Rights Center, the PP&AC Act will be especially beneficial to those on Medicare.  “People with Medicare will save hundreds of dollars each year as the coverage gap in the Medicare drug benefit is phased out. They will have better access to preventive services and primary care. Hospitals and doctors will have new incentives to provide high-quality, coordinated care that will help people with Medicare manage chronic conditions. Medicare's finances will be stronger and the budget deficit will be reduced.”

For a high-level overview of all the changes that the PP&AC  Act introduces see this document (note: Medicare specific information starts on page 23): http://www.kff.org/healthreform/upload/housesenatebill_final.pdf

Another good source of information regarding health insurance reform and Medicare can be found here: http://www.healthreform.gov/reports/medicare/index.html

Sources: healthreform.gov, seniorjournal.com, kff.org

On Sunday, the Senate version of the health care reform bill passed in December comes up for a vote in the House of Representatives.  Many journalists, political analysts, and politicians believe that the outcome of Sunday’s vote will either make or break the Obama presidency.  If the bill fails news outlets from NPR, CNN, Fox News and others are reporting that President Obama, as well as the entire Democratic Party, will be significantly weakened. 

If one needed validation of what is at stake, President Obama has delayed a trip to Asia in order to rally those in the Democratic Party who are still undecided or still opposed to the health care reform bill.  With the Obama Administration tying the health care reform bill so closely to his party, Democrats in opposition may have no choice but to vote yes or else see their overall influence and reputation greatly diminished with a failed bill despite a large majority. 

Rep. Dennis Kucinich (D-OH), who previously voted no in November, will now vote yes after having four meetings with the President.  Mr. Kucinich stated “You do have to be very careful that the potential of President Obama's presidency not be destroyed by this debate,” he said.  “Even though I have many differences with him on policy, there's something much bigger at stake here for America.” 

According to Mara Liasson at NPR, President Obama is also telling Democrats in opposition to health reform that despite their no vote, Republicans will still tie them to a failed bill and the Democratic base will exile them.  With such political arm-twisting, it will be interesting to see which Democrats have the gall to remain in opposition.

For those of you who would like to read the actual bill, you can find it here: http://i2.cdn.turner.com/cnn/2010/images/03/18/health.care.pdf

The health reform saga continues in Washington with a new, comprise proposal currently being assessed. For those of you who may not be aware, late last month President Obama unveiled a new $950 billion health care reform proposal that he and fellow Democrats believe to be a compromise, including several Republican solutions. Obama said the plan will be fully paid for and will reduce the deficit over 10 years by $100 billion.

The plan calls for the same things we’ve been hearing for the past year, such as insuring 45 million currently uninsured Americans and guaranteeing coverage for everyone. What is interesting is how President Obama wants to pay for all of it. Here is a list of costs that may or may not have a direct affect on you and your loved ones:

Tax high-cost medical plans: “Cadillac” plans will be taxed, but of course the insurance companies will most likely pass these costs along to their customers.

Increase Medicare tax on the rich: Individuals making $200,000 ($250,000 for joint filers) will see a .9% increase in their Medicare tax to 2.35%. Obama would also add a new 2.9% Medicare tax on these individuals’ investment income.

Require employers to pay if they don’t provide coverage: Employers who don’t offer an affordable plan will be charged $3,000 per full-time worker, while employers who don’t offer insurance at all will be charged $2,000 per full-time worker. This only applies to employers that have 50 or more employees.

New fees for health industry: New fees would be imposed on drug makers, medical device manufacturers, and insurance companies. Also, there will be a limit on compensation paid by health insurance companies.

Cut various health tax-breaks: An additional 10% penalty would be imposed for non-health related withdrawals from health savings accounts. A $2,500 limit would be imposed on flexible health spending accounts through employers. Also, the amount of medical expenses necessary to qualify for a federal tax deduction would be increased.

Gerber Life Medicare Supplement to Release in New States

If you haven't heard by now, Gerber Life Insurance Company will soon release its blockbuster Medicare supplement in the following states: Alabama, Arizona, Louisiana, Ohio, Oklahoma, Oregon, Texas, Virginia, Washington, and West Virginia. For more information contact us.

Fox Ejected from Medicare Drug Program

Fox Insurance Company of New York is no longer a part of the Medicare prescription drug program. The Centers for Medicare & Medicaid Services explained its decision to kick out the company stating Fox did not meet Medicare’s requirements to provide enrollees with prescription drugs according to recognized standards of care, and also jeopardized the health and safety of Fox enrollees in the 21 states where it operates. Fox enrollees can obtain their drugs through LI-NET starting on March 17. They will also be able to choose a new Part D plan through May 1, 2010. After the date, Medicare will automatically enroll them into a new plan.

Sources: NPR, CNN, Gerber Life, Senior Journal

Update: The House of Representatives passed the Affordable Health Care for America Act Saturday night with a tight vote of 220-215. To learn more about this recent event click here.

Yesterday, both AARP and the American Medicare Association announced their support of the health care reform bill that will soon be voted on in the House of Representatives. Though AARP has been losing members over its endorsement of the Democrat –only supported bill, it still remains a powerful lobby with over 40 million seniors a part of its organization. According to the Associated Press, AARP Senior Policy Adviser John Rother said the organization supports the bill as it closes the coverage gap in Medicare prescription benefits, strictly limits what health insurers can charge older workers too young for Medicare, and creates a voluntary, long-term care insurance program.

The AMA acknowledged that the bill is far from perfect, but determined that the bill’s pros far outweigh the cons. The biggest point of criticism from the AMA is that the bill doesn't change the current Medicare payment formula which it says will lead to a 20% doctor pay cut in 2010. The American Cancer Society Cancer Action Network is another group that also announced its support for the bill.

As mentioned before, the issue over whether federal funds can be used to pay for abortions is a divisive issue among Democrats in the House and threatens the bill’s passing. Democrat leaders say the issue will be resolved soon and there is a proposal now being considered that they believe will gain all of the party’s buy-in. The current proposal essentially prohibits the use of federal money for abortions, while allowing individuals on the public plan to pay for abortion coverage using their own money. Details are currently being ironed out on how the government can ensure that its subsidies will not be used to pay for abortions.

Another major issue that threatens the passing of the bill is illegal immigration. As it stands, illegal immigrants are prohibited from receiving federal subsidies, but the point of contention is over whether illegal immigrants can purchase insurance through the proposed government exchanges using their own money. The White House opposes this, while major Hispanic organizations such as the Congressional Hispanic Caucus and other Democrats in the House believe it should be allowed.

UPDATE: Many of you want more information as to why these two organizations are supporting the bill. To learn more about each organization's respective decisions I've added a link to each organization's official press release:

American Medical Association Press Release: http://www.ama-assn.org/ama/pub/health-system-reform/ama-supports-house-bills.shtml

AARP Press Release: http://bulletin.aarp.org/yourhealth/policy/articles/health_care_reform7.html

House of Representatives Speaker Nancy Pelosi announced the introduction of a combined health care reform bill that has the primary goal to provide health insurance coverage to 96% of all Americans. Though the bill was announced to cost $894 billion, according to the Wall Street Journal and other major news outlets, the real cost of the bill is expected to be more than $1 trillion once all factors are included, such as changes to Medicare. The following is a list of other key objectives included in the bill:

• Insurance for 36 million uninsured Americans will be subsidized
• Health exchanges will be established to make it easier for small groups and individuals to purchase coverage
• Private insurance companies can no longer deny coverage for pre-existing conditions
• Annual out-of-pocket expenses will be capped
• The bill will be financed by increasing the tax liability among the rich ($500,000 individual / $1 million families annual income) and reduced spending for Medicare and Medicaid (1.3% annually)
• Private insurance companies are able to negotiate reimbursement rates with the government
• Individuals are required to have coverage or pay a penalty equivalent of up to 2.5% of their income
• Poor Americans are exempt from this requirement

Debate over this bill (consolidated from several committee bills) is expected to begin next week. If this bill is passed, it would then go on to be consolidated with any legislation passed by the Senate. There is still one key issue dividing Democrats in the House that could stall the bill – the use of federal money to pay for abortions.

Weekly Recap:

Nursing Home Costs Approaching $80K/year: According to a just-released study conducted by MetLife on the costs of long term care, private room nursing home rates rose 3.3% to $79,935 per year or $219 a day, assisted care living rose 3.3% to $3,131 per month, adult day services increased 4.7% to $67/day, and the hourly wage of home health care aides increased 5% to $21 an hour. To read the full survey, click here.

$800 Billion Wasted Each Year in Health Care: According to an independent report by Reuters, $600-$850 billion a year is wasted by the health care industry. The biggest categories of waste identified were administrative inefficiencies, unneeded medical services, and fraud/abuse. Click here for the full article.

Health Reform to Lower Costs for Small Business?: The HHS released a report this week explaining how businesses will see lower premiums if health care reform legislation supported by the White House is passed. It is an interesting read for you small business owners; just remember this isn’t an independent report. You can check out the report here.

Gerber’s Med Supp Now in CA and IL: Gerber Life’s Medicare supplement was released to consumers in CA and IL today. For marketing materials click here.

Sources: Wall Street Journal, CNN, MetLife, Reuters, HHS

On Tuesday the Senate Finance Committee rejected two health care public option proposals. A handful of moderate Democrats and all 10 Republicans on the committee voted to exclude a public option from the current, $900 billion, 10-year plan under consideration. The first proposal was rejected 15-8 with five Democrats opposed, while the second proposal was voted down 13-10 with three democrats voting against.

Depending on the slant of your news source, some consider this to be a death knell for the public option as this vote indicates that supporters are short of the 60 votes needed to prevent a filibuster and get the public option passed. Those is support of the public option state that this recent rejection doesn’t matter since the real points of contention are when the time comes to merge the finance committee bill with a bill from the health committee that does include a public option, and later when Senate legislation must be merged with legislation in the House that also includes a public option.

The Senate Finance Committee proposed its own alternative to the public option – non-profit health insurance cooperatives. Proponents of this option believe that absent the focus on profit, such cooperatives will provide greater value and quality for its customers. Opponents cite the lack of historical data as a primary reason why such cooperatives are not a viable alternative. Now that insurance cooperatives are in the national spotlight, more studies are expected to take place to assess their feasibility.

Weekly Recap:

Life Insurance Selling Grows: According to the Pittsburgh Post Gazette, the current economic hardship has resulted in a dramatic increase of senior citizens selling their life insurance policies in order to get cash. However many of these senior don’t realize the possible negative consequences of doing so, such as losing Medicaid status, having to provide all medical records to investors, and tax issues. Though a $12 billion industry, little regulation exists. Now Sen. Herb Kohl, Chairman of the Senate Committee on Aging has requested the SEC to look into industry practices and provide better rules and regulations to better safeguard seniors.

‘Tis the Season: For seasonal shots that is. Though H1N1 hasn’t spread among the senior population, there are still other diseases that seniors should guard themselves against. Remind your clients to get their seasonal flu and pneumonia vaccinations as seniors are more susceptible to these diseases according to the Center for Disease Control and Prevention. Recommended adult immunization schedule - United States, 2009

Part B Increase News: The House passed a bill that will prevent an increase in the Medicare Part B insurance. The bill makes $567 million available to pay for the additional cost. To become law, the bill still needs to be passed by the Senate and signed into law by President Barack Obama. Next up for the bill – the Senate Finance Committee.

Sources: CNN, NPR, CDC, Senior Journal, PPG

According to National Underwriter the Centers for Medicare and Medicaid Services (CMS) ordered all Medicare Advantage providers to suspend what it considers to be misleading mailings sent to beneficiaries about health care and health reform.

The order was sparked by a mailing campaign conducted by Humana Inc. The mailings conveyed to recipients that current health care reform legislation in Congress would eliminate the entire Medicare Advantage program.

CMS representatives state that the mailings may be in violation of Medicare rules, as Humana’s campaign assets were not submitted to CMS for approval – a requirement for any marketing piece that contains Medicare Advantage benefit information. Humana has agreed to suspend the mailings while a final decision is made.

Representatives from America’s Health Insurance Plans (AHIP) are criticizing the move as unfair and calling it a “gag order.”

Weekly Recap:

World Alzheimer’s Day: On Sept. 21, Alzheimer’s Disease International released a report stating that 5.3 million Americas have the disease. The report also forecasts that 35 million people worldwide will have dementia next year which is primarily caused by Alzheimer’s disease. The most startling fact in the report is its forecast that dementia prevalence will almost double every 20 years to 65.7 million in 2030 and 115.4 million in 2050.

Bill to Stop Part B Increase: A new house bill was introduced that aims to keep Medicare Part B premiums the same. With no Social Security benefit increase next year, an increase in Part B will effectively further reduce the income of senior citizens. The bill is sponsored by Rep. Dina Titus (NV-D), AARP, and several other senior-advocate organizations.

AA Retirees Lose Coverage: American Airlines will discontinue paying for Medicare supplement insurance for its retired, non-union employees because the cost is too high. As of January 1, non-union retirees age 65 and older will have to pay for supplement insurance themselves. Those who participated in the pre-fund program will be reimbursed. Sources: National Underwriter, Senior Journal, Dallas Morning News

The Gerber Life Medicare supplement launch has no doubt inundated your inbox with about 50 emails regarding this product from various entities, so if you’ve made it to this page, I want to personally thank you. Like you, everyone here at PSM is seeing the famous baby face in their dreams at night with the massive amount of activity that has taken place since Tuesday. Our phones have been ringing constantly, and our website has seen 10,000 page views since the release of the product. If you haven’t seen our national press release, check it out at: http://www.prweb.com/releases/Medicare-Supplement/Gerber-Life/prweb2837364.htm If you are still on the fence about this product, we encourage you to call us to learn why this product is set to be one of the most competitive in the market. For reference here is a direct link to our Gerber Life Medicare supplement landing page with more links to rates and contracting information.

Weekly Recap:

Remembering 9/11: PSM will take a moment of silence today to honor those who lost their lives during the events of 9/11.

President Obama’s “Full-Court Press”: Beginning with addressing a joint session of Congress on Wednesday night, President Obama will be making several speeches detailing his vision for health care reform. Of course, the biggest news stemming from the speech seems to be the outburst from Joe Wilson (R-SC) who shouted “You lie” when Obama stated that his health reform vision doesn’t include coverage of illegal immigrants. Here are some of the other details stemming from the speech:

* No one will lose health insurance coverage if they already have coverage.

* Insurance companies will not be able to deny individuals coverage because of pre-existing conditions.

* Inclusion of Sen. McCain’s (R-AZ) plan to cover people without insurance if they can’t afford it and can’t wait four years until the Health Insurance Exchange is established.

* The majority of health care reform will be paid for by cutting Medicare costs.

* The most expensive insurance plans will be taxed, with the revenue paying for reform.

* Medicare malpractice reform is another possible way to pay for reform.

* A public option is not mandatory.

* Those who already have health insurance through a job, Medicare, Medicaid or the VA, will not be required to change coverage or doctors.

* Insurers will be required to cover basic checkups and preventive care.

* Health care reform will not result in euthanasia or death panels for the elderly.

* Out-of-pocket expenses will be capped.

Chronic Conditions Highest Among Elderly Women: Last week, a Health and Human Services report showed that chronic conditions are most prevalent among women because they live longer. This may seem like a no-brainer, but the report does have some very interesting quantitative data that you may find useful to present to your clients. Here are some of the most interesting points:

* Among people age 80 and older, 93% have at least one chronic condition and 78% have two more.

* The growth in Medicare Part B premiums from 2000 to 2018 is predicted to cost seniors an additional $1,577 per year out-of-pocket.

* 98% of Medicare spending is for beneficiaries with one or more chronic conditions.

* Senior women spent on average 17 percent of their income on health care in 2005.

For this and other HHS reports click here.

Health care reform continues to be at the forefront of legislative agenda. No doubt you have heard or read many reports through various news outlets. With so much going on in recent days, it can get pretty confusing. The biggest news thus far is the advancement of a bill in the U.S. House of Representatives by two committees.

The 1,018-page bill maintains the employer-based health insurance system, and extends coverage to all uninsured with a public option. It also requires private insurers to offer policies to all willing buyers and bars them from charging higher premiums based on pre-existing conditions.

To pay for it all, the bill requires individuals who earn enough to file taxes to have insurance or pay a 2.5% penalty on the difference between one's adjusted gross income and the tax filing threshold. It also requires that businesses provide insurance, and that a tax be imposed on such employer-provided benefits. Businesses that don't will pay a payroll tax ranging from 2-8%. The bill also implements a 1% to 5.4% surtax on individuals who make $280,000 or more annually. This is all in addition to the Medicare and Medicaid cuts discussed here previously.

Though the bill was pushed through by House democrats, it was met with criticism by two unlikely, but influential individuals - Douglas Elmendorf, chief of the Congressional Budget Office and President Obama. President Obama opposes taxing employer-provided benefits, and Mr. Elmendorf says the overall bill doesn't reduce the cost of health care to the federal budget over the long-term. Politicians drafting the bill are now re-working the bill to appease President Obama and other influential critics. According to the Chairman of the Senate Finance Committee, Sen. Max Baucus (D-Montana) "Basically, the president is not helping us."

On another subject, Precision Senior Marketing is sponsoring the "Nature University Contest." To enter, submit a short essay of 250 or more words demonstrating leadership. Winners will have their essay featured on the globally marketed site, as well as win either a $150, $100, or $50 Amazon.com gift certificate. For more information: http://natureuniversity.info/

Blog entry sources: Wall Street Journal, CNN, Associated Press

As you all know, identity theft is a rapidly growing problem. The Javelin Strategy and Research Center found that 10 million Americans fell victim to this crime in 2008. You may think identify theft is primarily caused by using the latest and greatest technology, but according to the Center, low-tech methods are still the most popular among identify thieves. Online methods only account for 11% of all cases.

One growing, low-tech method used to commit identity theft that may directly affect you are thieves posing as state insurance department employees. Recently, Oklahoma Insurance Commissioner Kim Holland warned insurance producers and adjusters to beware of scammers posing as state insurance department employees seeking personal information. According to reports, these fake employees called insurance agents and asked them to fax personal tax information. Similar cases were also reported in Nevada and California where imposters were calling agents and telling them that their licenses were going to be suspended for filing improper paperwork. The imposters then would ask for personal information, such as birth dates, social security numbers, and credit card info to correct the problem.

We remind you to remain vigilant about protecting your personal information. Here are several actions you can take to minimize your chance of becoming a victim (source: www.ftc.gov):

• Review your credit reports at least once a year, or every three months if you have already been victimized
  
  
• Place passwords on your credit card, bank, and phone accounts; don't use easily available info for your passwords such as maiden names, birth dates, phone numbers, and last four of SSN
  
  
• Secure personal information at home, especially if you live with others
  
  
• Always ask how your personal information will be secured by those who require it to do business
  
  
• Don't give out personal information over the phone, through the mail, or on the Internet unless you've initiated contact or have established trust with the entity you are dealing with
  
  
• Shred your docs with sensitive info

For a full list of actions you can take to help prevent identify theft, click here.