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 Profits are booming at health insurance companies
The largest health insurance companies in the United States reaped historically large profits in the first quarter of this year, despite all the noise surrounding the Affordable Care Act's individual marketplaces.
Aetna, Anthem, Cigna, Humana and UnitedHealth Group — the big five for-profit insurers — cumulatively collected $4.5 billion in net earnings in the first three months of 2017. That was by far the biggest first-quarter haul for the group since the ACA exchanges went live in 2014.
Aetna lost money because it had to pay Humana a $1 billion break-up fee after their merger failed; otherwise it would have been in the black. Some other things to keep in mind:
- The ACA exchanges represent a small amount of the insurance market, and most of the for-profit carriers have bailed on those plans.
- Employer-based coverage is a profit center, but insurers continue to invest more in Medicare Advantage and Medicaid.
- Congress suspended the ACA's health insurance industry fee for 2017, which is creating a temporary windfall.
- The first quarter of the year is usually good for health insurers. Deductibles are reset, leaving people on the hook for a lot of their out-of-pocket medical expenses. The fourth quarter usually is the worst, since people often reach their deductibles by the end of the year.
Source: https://www.axios.com/profits-are-booming-at-health-insurance-companies-2418194773.html
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 More and more seniors are finding out that Medicare will not cover their stay at the hospital because they were not officially admitted. Instead, they received ‘observation’ care, which is an outpatient service not covered under Medicare.
Medicare covers the first 100 days of care for skilled nursing, only for patients who were formally admitted into a hospital for three consecutive days.
This is a growing trend that is very costly for senior Medicare recipients. Recent federal data shows a sharp jump in patients receiving ‘observation’ care. In 2011, 1.4 million patients were being labeled under ‘observation,’ compared to the 920,000 in 2006. The trend is apparent with patients who have longer hospital stays lasting more than 48 hours. Observation stays rose from 27,600 in 2006 to 112,000 in 2011.
The increased problem appears to be due to a Medicare effort to control costs through a program that audits hospitals for possible overpayments. Once the program identifies improper errors, the hospital must comply with Medicare and must refund all the Medicare payments it received. This has made hospitals more cautious about the admission process and what they think could be challenged; as well, it allows a hospital to receive a lower reimbursement for observation status patients.
Since 2011, a long time legal battle has prompted a class action lawsuit from the non-profit Center for Medicare Advocacy (Bagnall v. Sebelius), to force the government to change its policy. It has also encouraged other advocacy groups, healthcare providers, and lawmakers the need to change the law.
Momentum to change the law is also (apparent) in Congress, as Senator Sherrod Brown (D-Ohio), is proposing as part of hospital admission process, a legislation that would force Medicare to count all overnight hospital stays; the House of Representatives a similar legislation.
By April Medicare is set to apply a new rule that would require doctors to admit people as patients they expect to stay more than two midnights, and to classify anyone else under observation status. However, there is great resistance to delay the new law from a large coalition of healthcare providers and advocacy groups whom argue that it will be very difficult to comply with the new rule. They argue it would arbitrarily reward patients who happen to arrive at the hospital at certain times of day and that it does not alter the three-day rule.
Traditional Medicare recipients can be affected by the observation status and are the most vulnerable to the rule. Unlike (patients) that uses Medicare Advantage programs, they are subject to their insurance provider’s plans.
Medicare Advantage plans provide comprehensive medical coverage, higher-quality care, better services, and additional benefits, reports The Coalition for Medicare Choices, a national grassroots organization who sole purpose is to protect and improve Medicare Advantage.
Traditional Medicaid program covers 100 percent of the first 20 days of a skilled nursing facility, only when the patient meets Medicare's three-day formal admission hospital rule. Patients are responsible for $152 daily co-pays for the remaining 80 days. Otherwise, patients pay full out-of-pocket cost for the skilled nursing facility if they left the hospital under observation status.
In New York, the daily cost for a skilled private room averaged $230 in 2013, with cost going up to $344 in New York state, according to a survey conducted by Genworth Financial. The survey data illustrates that an observation status patient would pay $34,440 for a 100-day stay in a skilled facility compared to the $12,160 out-of-pocket cost a formally admitted patient; that is $22,280 more.
Hospitals are not required by law to notify patients of their hospital status in many states. The only way seniors may be able to protect themselves from observation status is to constantly ask or have a family member or legal guardian, request to be formally admitted into a hospital.
Please give us your feedback!
Question: Should the government do more to protect seniors by passing a law that makes hospital disclose the patient’s admission status?
Source: Reuters & NBC Nightly News |
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 With looming deadlines of October 15, for Medicare’s traditional open enrollment date, and the overlap of the first enrollment period for Patient Protection and Affordable Care Act set to start on October 1 – December 7, has caused a lot of confusion among seniors over their coverage.
Adding to the confusion is the increased media frenzy reporting of the state exchanges for individuals 65 and under, and insurance companies offering coverage to both the new exchanges and to Medicare recipients.
Federal health officials have stepped up the efforts to let seniors know they have nothing to worry about and that the Medicare benefits are not changing under the Affordable Care Act. They want Medicare recipients to know that the enrollment period of Oct 15th – Dec. 7th, will be business as usual and seniors will be able to sign up to new plans by continuing to go to Medicare.gov.
Federal health officials have ramped up their call centers, training for Medicare counselors and website. This is in preparation to the influx of calls they will be receiving in October, in anticipation of the 50 million Medicare beneficiaries who will be mailed a handbook with a prominent Q&A, stressing their benefits aren't changing. Calls are already being rerouted to Medicare call center from the state exchanges call centers, said Julie Bataille, spokeswoman for the Centers for Medicare and Medicaid Services.
Worries still linger within the senior community despite federal efforts to stem down the confusion. Under the Affordable Care Act, seniors will not be able to purchase Medicare supplemental insurance or Part D drug plans through the state exchanges. This is what worries seniors such as, 72 year old Bob Roza who actively attended meetings in order to find out what ACA was and how it would affect him and his 69 year old wife with diabetes.
Roza, who underwent hip replacement this year, now worries how the ACA will affect his $614 monthly fee and his Medicare supplemental insurance, in spite of his Medicare coverage.
Advocacy groups have also taken an interest on the matter. They feel the federal health officials have put most of its efforts on those who already are on Medicare and have not done enough outreach to inform seniors without Medicare, said Jodi Reid, executive director of the California Alliance for Retired Americans. She feels that advocacy groups have picked up the tab and are using the majority of their advertising dollars to inform seniors affected by the exchange. Her group has put together a one-page fact sheet to educate nearly 1 million California seniors.
Officials of the AARP said they are organizing several events around the country, hosting 21 telephone town halls to clarify questions to seniors who are either Medicare or Non Medicare recipients.
As the Affordable Care Act inches closer, advocates are warning seniors not to give any personal information. To watch out for scams that may surface alongside legitimate Affordable Care Act outreach.
Please give us your feedback!
Do you feel there is still a tough job ahead to inform seniors about what the Affordable Care Act is and how it impacts Medicare? Do you believe all the outreach efforts from advocates and federal health officials will help millions of uninsured people to sign up for coverage by the end of March or will just stir more confusion?
Source: LifeHealthPro
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 As the Affordability and Accountability Act inches closer to the October 1st launch date, many insurers are anticipating major changes in the regulatory and funding under the new health care reform law. With all this anticipation going around, how will the Medicare Supplement and Medicare Advantage programs be affected by the changes?
For Medicare Supplement program, health care is hardly unaffected by the ACA. Under the new changes (Section 3210 of ACA), the National Association of Insurance Commissioners (NAIC) was required to add a minimal cost to the C and F plans. In December 2012, in a letter to Health and Human Services Director Kathleen Sebelius, the NAIC recommended a no cost sharing to the plans, stressing that that the additional cost would decrease usage. In May 28, 2013, the no cost sharing to plans C and F was accepted in a letter response by HHS Director Kathleen Sebelius.
The Medicare Advantage program has been affected the most by the changes. The ACA holds the Med Advantage program to an 85% minimum loss ratio. It further requires the funding levels to the plans to be restructured, removing 14% overpayment to Medicare Advantage, aligning it closer to the traditional Medicare program. This in spite of the 2012 demonstration program by Centers for Medicare & Medicaid Services, which expended payments to the Medicare Advantage program and regulates the funding and cuts of program.
With the regulations that the ACA has put in place for the health care reform, it has had a two-pronged road affect. The traditional plan seems to have gone unscathed, while the Med Advantage has an uphill battle adjusting it rates to the market, as well as, and being a hot topic for future political health battle grounds to come.
Please give us your feedback!
Does the health care reform hurt the Medicare insurance industry or will it make it more competitive and affordable?
Source: CSG Actuarial
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 In recent years, the numbers of doctors who have chosen to participate in Medicare program have risen. According to a Department of Health and Human Services, it rose by one-third from 2007 and 2011. The growth can also be seen in the 2011; about 1.25 million physicians billed Medicare, compared to the 925,000 of those who billed for their services in 2007, as reported by HHS Office of the Assistant Secretary for Planning and Evaluation.
According to Jonathan Blum, deputy administrator and director for the Center of Medicare, the trend "provides a more complete picture of how physicians choose to participate in the Medicare system."
The growth has continued despite the physicians complaints about Medicare payment caps, new paper work requirements, and Congress political delays of the payment of the Medicare beneficiary system, which could lower rates by 30% and is designed to ensure Medicare expenses do not exceed GDP growth.
However, in a Wall Street Journal article, it was reported that there was an increase in physicians opt out rate from the Medicare program, the number had risen from 3,700 doctors in 1997 to 9,500 in 2012, commissioning an investigation to the findings.
In spite of the WSJ article, Medicare Payment Advisory Commission (Medpac), reported that even though older doctors are opting out of the Medicare system, more new primary care professionals are opting into the system, according to Blum.
The researchers found that office based doctors made up 90% of those accepting new Medicaid patients, and Medicare patient found doctors in a timely manner. They also found 28% of the 7% of Medicare patients searching for new primary care doctors had a challenging time finding one that accepted Medicaid the year before. These are rates similarly aligned to those of private insurers, said Blum.
Please give us your feedback!
Do these findings raise awareness that agents and brokers make health insurance shopping more affordable?
Source: USA Today
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 Running a business can be a daunting task; even more so, if the business has been running on survival mode for the last couple of years. Everything that has been tried to ensure success has returned nothing but disappointment.
What went wrong? Why is the business only hanging by a thin thread? The business has a marketing plan in place and a large budget to focus on traditional and new media techniques; such as, direct mail, radio, emails, and search engine optimization (SEO). Plus, it offers a wide range of products that the public wants. Yet, nothing seems to work!
For many advisors, it is hard to see that the problem comes from poorly designed marketing campaigns. Too often, advisors are too eager to sell their product. They focus on getting one message out to the masses, and expect to see a great influx of leads to be quickly converted into sales.
Instead, focus on the targeted audience and identify what their needs are. Once this has been determined, then the marketing message and campaigns can be tailored accordingly. Do the same to the other product lines, identify, categorize, customize, and so on. Soon, your hard work will pay-off, and you will see leads building up.
Engage them further, once the prospect has made contact; follow up with a call, invite them to a free event, offer a free report or direct them to informative video feeds on your website. These little actions will help keep the dialogue open and help ease their decision into becoming a new customer.
Just remember by building an effective marketing plan that will allow you to identify prospects needs, match them with the proper product line, and build a system to engage them and follow up, you should be well on your way to the road to excel as an advisor.
Question: Do you feel your business is hanging by a thin thread? Would revamping the marketing approach help your business move in the right direction?
Please give us your feedback!
Do you feel your business is hanging by a thin thread? Would revamping the marketing approach help your business move in the right direction?
Source: LifeHealthPro
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 Patient readmission back into the hospital within a month of discharge has been a common occurrence and has driven up the cost of care for insurers and patients alike for many years.
Medicare has taken noticed of the practice and, for the second year, has penalized hospitals with excessive patience remittance of 30 days or less. This has been Medicare’s strongest effort to reduce the costly readmission rates.
About two-thirds of the hospitals penalized were eligible for Medicare payments. These hospitals were fined in the form of lower readmission payments. This translates to hospitals losing $227 million to the Medicare program that began in October, according to Kaiser Health News.
To lower cost, Medicare has also undertaken a two-pronged approach, focusing on both the research and payment side. Under the Independence at Home Demonstration, which is made up of 15 independent practices and 3 consortia, Medicare has designed this program to identify new processes and policies with hospitals to reduce the monthly readmission rates. While on the payment side, they are aggressively cutting the reimbursement payments to the penalized hospitals.
The numbers in hospital penalties averaged so slightly between both years. In round one 1,371 fines were given. In round two, 1,074 repeat penalties were re-issued and 283 new penalties that had gone unnoticed last year were added to the roster this year.
Furthermore, hospitals that were less likely to be fined were those treating the fewest numbers of impoverished or lower income patience.
Please give us your feedback!
Do you think Medicare’s penalizing hospitals for readmission rates will help bring down the cost in the long run? Should all healthcare providers, who are not participating, follow suit?
Source: LifeHealthPro
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 In 2014, Medicare Part D premiums will reach $31, an increase from the past 3 years of $30. By 2014, Part D deductible will fall to $310 from the current $325.
When the Medicare Part D program began, there was a lot of concern the cost of the program would go up. Instead, the program has had the opposite effect and the cost has been kept low. Much of it is due to the strong competition and bidding parocess from the participating private insurers, according to Jonathan Blum, deputy administrator and director for the Center of Medicare.
Medicare has saved more than 6.6 million people, more than $7 billion on prescription drugs, and averaging $1,061 per beneficiary.
This is largely due to the government reaching out to pharmaceutical industry and bargaining for drug discounts. In order to participate in the 2013 Medicare program, the pharmaceutical industry agreed to a 52.5% discount on name brand drugs and 21% on generic ones. This savings has been passed on to the seniors. However, higher spending could be triggered for discounted premium drugs, cautioned the governments Medicare watchdog.
In March, The Medicare Payment Advisory Commission reported that Medicare's reinsurance payments are the fastest-growing component of Part D spending. Hence, the higher-cost and demand for specialty brand drugs for cancer treatment, which are not available on generic brands. These name brand drugs add to the cost of the reinsurance cost of the Part D program. However the gap that begins when a person’s Part D Coverage reaches $2,970 will close by 2020.
Blum also assured that seniors who reach the gap will ultimately benefit from the program because when the patient takes their medication, they will likely be healthier and may not require hospitalization.
Please give us your feedback!
What do you think of Medicare Part D program? Should there be a concern of seniors over spending on brand name drugs?
Source: LifeHealthPro
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 If your sales aren't as high as you’d like them to be, it might be time for a new perspective. Whether you've encountered situations you haven't dealt with before, or ones that change midway through the sales conversation, a new perspective can help you manage the change.
Here are some questions to ask yourself:
- Are you visiting/talking to enough clients and prospects? Are you being proactive and keeping your activity high? Determine your customer contact time as a percentage of your total working time. Although, remember not to confuse movement with action.
- Are you talking to the right people? Consider how your cold-calling strategy and any leads you are purchasing are working for you. What is the rate of return on your investment? Are you speaking with turning 65 leads or older seniors looking to switch plans? Also, make sure you are speaking with the decision maker in the household. Some seniors may prefer you speak to their spouse, caretaker, or child.
- Are you saying/doing the right things? Are your sales skills up to par? If not, look into taking a course or seeking out advice from someone you admire as a mentor. You can also talk with your marketing representative at PSM, who have sales scripts, tips, and techniques that can help guide you to fulfilling your sales goals.
- What is your predominant attitude? As cliché as it sounds, your attitude on each call is a small thing that makes a big difference. It sets the tone and drives the call. Are you excited about your product? Find an angle, and be aware that you will drive your sales with it.
When you look at these problems from a different perspective you will find you can increase your sales, improve your approach, and find creative ways to solve the problem you are struggling with.
Please give us your feedback!
What have you done to change your prospective in your business? How did it affect your closing ratio? What advice do you have for other agents who might be struggling?
Source: LifeHealthPro
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 When discussing your clients’ health care options and planning for their future, Short Term Care (STC) insurance is a great option for them to consider. Though it is human nature to not want to think about something happening to us, in reality sometimes an unexpected illness or accident forces us to change our lifestyle and adjust our finances. Created especially for the Baby Boomer generation, STC Insurance covers the costs of health care recovery. It gives your clients and their family breathing room and peace of mind during times of crisis.
With the costs of hospital stays skyrocketing, many seniors are now choosing to stay in a nursing home or have a caregiver come to their home in order to recover as quickly as possible. To give your clients perspective on the costs associated with this kind of care, the average price for an in-home care taker is $21 an hour, or $5,040 a month for 8 hours a day/7 days a week. If a nursing home is better suited, the average cost for a semi-private room is $5,940 a month. These costs multiply quickly, however with a monthly payment on par with the cost of a cable or phone bill an STC insurance policy can be in place and money will be made available for the policyholder to draw from when they need it.
Precision Senior Marketing has partnered with MedAmerica to offer our agents one of the most comprehensive and affordable Short Term Care Plans in the industry. To find out more about the benefits for your clients and generous agent commissions, please call PSM at 1-800-998-7715 or visit our MedAmerica Transitions Short Term Care page.
Please give us your feedback!
Do you sell Short Term Care policies to your clients? Do you find them receptive to the product? What benefits do you focus on when talking about it to your clients?
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