Posted on Tue, Mar 31, 2009
Employee Benefit Plans And Group Health Insurance Plans:
Small businesses desperately looking for ways to reduce operating costs are canceling their employer group health plans at a rate not seen in more than twenty years, creating a spike in individual and family health insurance enrollments. As the nation is engaged in overall health care reform, a focus on making sure small businesses are able to receive affordable health coverage is being called a top priority at a joint press conference with the National Federation of Independent Business and (NFIB) and America’s Health Insurance Plans (AHIP).
On the accessibility of affordable medical insurance coverage, Dan Danner, the CEO and president of the NFIB, stated his thoughts on the importance of this matter: “We must work together to pursue creative, private market solutions to what has become an unsustainable problem for small businesses – increasing small group health insurance costs.” He continued by adding, “It is imperative that insurance market reform – specifically in the individual health and small group health insurance markets – leads to greater access to larger pools, increased portability and competitive choices.”
The AHIP conducted a nationwide tour of the United States to get opinions and stories directly from the American people in regards to their experiences with health care institutions. The people with whom they talked to were also asked for their ideas for health care reform. During their conference the AHIIP released their findings to the joint committee.
In 2008:
· Small group health insurance premiums averaged $913 per month for family medical plans and $346 for individual medical coverage.
· Health insurance premiums ranged from as low as $198 a month in Washington to $504 a month in Alaska.
· Companies with more employees generally paid less than companies with fewer employees.
· Forty-one percent of businesses had an HMO plan, 50% had a PPO and only 7% were enrolled in heath savings plans in 2008.
AHIP released a statement highlighting the specific needs and obstacles faced by small businesses, calling policymakers’ attention to difficulties faced by small businesses. The organization recently launched the “Campaign for an American Solution”, a new national grassroots and educational initiative to build support for workable health care reform based on core principles shared by the American people: coverage, affordability, quality, value, choice and portability.
In a letter to key Senators last week, AHIP and the Blue Cross and Blue Shield Association offered to curb its practice of charging higher premiums to people with a history of medical problems. The offer from AHIP and the Blue Cross and Blue Shield Association is a potentially significant shift in the debate over overhauling the nation’s health care system to rein in costs and cover an estimated 48 million uninsured people. In the letter, the two insurance industry groups said their members are willing to “phase out the practice of varying premiums based on health status in the individual and family health insurance markets” if all Americans are required to get health insurance coverage.
“The offer here is to transition away from risk rating, which is one of the things that makes life hell for real people,” said health economist Len Nichols of the New America Foundation public policy center. “They have never in their history offered to give up risk rating.”
“This letter demonstrates that insurance companies are open to major insurance reform and are even willing to accept broad consumer protections,” said Sen. Jeff Bingaman, D-N.M., a moderate who could help bridge differences on a health care overhaul. “It represents a major shift from where the industry was in the 1990s during the last major health care debate.”
AHIP has published its proposal for health care reform to make medical insurance affordable, and they state: The U.S. could reduce total health care spending and improve the quality of patient care if the plan proposed today by America’s Health Insurance Plans (AHIP) was implemented. PricewaterhouseCoopers reviewed AHIP’s proposals and estimates, and concluded that if these proposals are fully implemented, the nation’s total health care expenditures could be $145 billion lower than currently projected by the year 2015.
“Insurance companies offering individual medical coverage cannot hire and train new employees fast enough to keep up with the recent spike in private health insurance enrollments”, said Tom Carolan, Director of Client Services for BestHealthcareRates.com, a health insurance information website based in Arroyo Grande, California. Carolan continued, “the plight of the individual medical coverage market is the focus of much media attention, but it is vitally important to economic recovery that small businesses get help”.
Posted on Thu, Jan 22, 2009
Most people have no idea what COBRA means. Congress enacted the Consolidated Omnibus Budget Reconciliation Act or COBRA to protect people in the event that they face the loss of health insurance coverage when changing jobs, after the death of the eligible employee, after divorce, or some other life altering event. COBRA is not health insurance. It is simply a law.
Once a person becomes eligible under COBRA, they have 60 days to make a decision about whether they want to continue coverage or not. If they decide they want coverage, COBRA allows them to continue coverage under their former employer group health insurance plan for up to 18 months. Premiums can be as much as three times the amount they paid while employed because the former employee is now responsible for 102% of the premium cost. Most of the time, it is prohibitively expensive. Maybe that’s why only 20% of eligible people elect to continue their health insurance benefits.
Fortunately, there are alternatives that can save people money. Health insurance agents have many different options they can present to people seeking health insurance. They are licensed professionals who are educated and experienced in dealing with healthcare insurance questions on a daily basis.
Here are just a few options that are available:
· Aetna is one of the largest insurance companies in the United States. They offer health insurance coverage in many different states. Aetna has group plans customized for the differing needs of the employers that buy group health insurance through the company. The cost and plans vary significantly depending on individual state laws and business needs. Aetna does business in the private sector as well.
· Blue Cross and Blue Shield are two names that are widely recognized around the United States. They offer health insurance to both companies and individuals. Because they are nonprofit companies, the rates are usually much more competitive than those offered by other companies.
· Short-term health insurance can be a very viable alternative for those who are in between jobs. Often, people are without insurance for only a brief period of time. Once they get a new job, they will be eligible to enroll in the group health care plan offered by their new employer. Short-term health care insurance is sold by many different companies and can be purchased by individuals through an independent health insurance agent. Coverage on these plans is usually very affordable, but does have its limititations.
Obviously, people need to seek the services of a professional licensed health insurance agent that does business in their state. They can provide free quotes and valuable information to help people make the right health care decisions relevant to their own unique situations.
Posted on Thu, Jan 22, 2009
People who have lost their jobs for any reason may be concerned about finding COBRA alternatives. The COBRA legislation was set up by Congress to provide protection for people who have health insurance provided by their employers. The Consolidated Omnibus Budget Reconciliation Act or COBRA was created to give people the option of continuing with insurance through the employer’s group plan for up to 18 months after termination of employment. In other words, if you lose your job for any reason you can elect to pay to keep the same insurance for up to 18 months.
It all sounds good in theory but there are a few concerns people face when considering using COBRA:
· COBRA is expensive. People have to pay about $600-$800 for individual health insurance through this plan. Families can expect a bill of at least $1300. Most people are unpleasantly surprised by the high dollar amount they are expected to pay for continuation of their health care coverage.
· Why is COBRA so expensive? While the person is working, the employer likely paid the majority of the health insurance premium. That was part of the employee benefits package. Once someone no longer works for the employer, the premium burden falls to the former employee because the employer is not required to pay for health insurance benefits for people who do not work for them.
· Unemployment compensation does not pay enough to cover COBRA. Affordability is important for people who have been laid off or lost their jobs. Affording a high health insurance premium is difficult for someone who lives on unemployment compensation. Most people who use their unemployment benefits only receive a maximum of $1300 each month. It does not make sense to spend almost all of that money to provide health insurance rather than food or living expenses.
· The government allows 60 days for someone to make the decision about whether or not to choose COBRA benefits or the alternative. Any person who has recently lost a job may not feel emotionally prepared to deal with finding affordable health coverage. Getting a health insurance comparison from a qualified insurance agent will equip a person to make a judgment about healthcare options.
The need for family medical insurance does not end when the job does. Changing jobs causes a lot of stress. Living without a job creates higher stress levels. High insurance premiums cause even more stress. Fortunately, COBRA alternatives do exist that can save money. A qualified private health insurance agent is the best person to consult for questions about health insurance.
Posted on Wed, Jan 21, 2009
Understanding all of the provisions related to COBRA is daunting even to some professionals and so is information about COBRA alternatives. There are important deadlines that must be met if a person plans on continuing their health insurance after becoming eligible for benefits under COBRA. Most people realize they have more questions after they have had their meeting with the human resources department or received their written notification of COBRA benefits in the mail. It is imperative that people take action to get the answers they need so that they can make an informed decision about whether to continue with their employer-sponsored benefits or to choose a COBRA alternative. Here are some questions that are common:
What is COBRA? Most people don’t even know what COBRA is much less have an understanding about how to sign up for benefits. In short, COBRA is the acronym for a law enacted by Congress in the late 80s. It was set up to protect employees from losing health insurance coverage when there is a death of the sponsoring employee, a divorce, a job separation whether voluntary or involuntary, or a reduction in qualified hours for retaining health insurance coverage. COBRA is not health insurance.
What is a COBRA alternative? Any private health insurance can be an alternative to COBRA. Policies are available for purchase from licensed health insurance agents. Private health insurance policies are contacts made between the person covered and the insurance company, not the employer.
How long do benefits under COBRA provisions last? People can continue their employer-sponsored benefits for up to 18 months. This can be extended for a total coverage of up to 36 months if the person meets eligibility requirements such as disability.
How long do benefits under a COBRA alternative last? As long as premiums are paid, private health insurance policies last until the policy is canceled for nonpayment or the covered person chooses to cancel the policy.
How much will it cost for benefits under COBRA provisions? This is a question that can only be answered by the benefits administrator in the human resources department of the former employer. People who choose to enroll in coverage continuation under COBRA provisions must pay for 100% of all insurance premiums plus a 2% surcharge each month.
How much will a COBRA alternative policy cost? People can get free quotes from a licensed health insurance agent. Premium costs vary by the type of policy and the state where the individual lives. Rates are also affected by health and age.
These are just a few of the many questions people may have about health insurance coverage related to COBRA and COBRA alternatives. People should contact the benefits administrator at their former employer for questions about COBRA. Questions about COBRA alternatives should be directed to a qualified health insurance agent.
Posted on Fri, Jan 16, 2009
There are COBRA alternatives. People often do not understand their options for health insurance coverage. When anyone faces a job loss, divorce, reduction in work hours, or death of a covered sponsoring employee, they may be eligible for extended coverage for up to 18 months under COBRA. COBRA is the Consolidated Omnibus Budget Reconciliation Act adopted by Congress to ensure that eligible people can continue to have access to their employer sponsored health care plan.
Health insurance is complicated. That is why insurance agents must study to pass a complicated exam before they can become licensed to sell it. Most people never read their insurance policies and do not listen or in some cases misunderstand when their employers explain about their rights under COBRA. They make many mistakes that can be very costly:
- People do not ask questions when they do not understand some detail about their rights under COBRA. They may feel embarrassed or intimidated. No matter how stressful it may seem, understanding their rights is a high priority. Everyone should ask as many questions as they need in order to make an informed decision about health insurance.
- People assume their former employer continues to pay for health insurance. Nothing could be further from the truth. Anyone who participates in health insurance under COBRA pays 100% plus a penalty.
- People often think they do not need health insurance. The reasons vary. Younger people think that since they are healthy, health insurance is an unnecessary expense. Others think they will find a job quickly. Not all employers provide health care coverage and these days, new jobs are hard to find. The lesson here is that young people do get sick, and it is a mistake to assume all employers will provide health insurance.
- People do not seek the help of an insurance professional. Paying for benefits under COBRA is expensive. Insurance agents have a number of options to fit the differing needs of individuals and families. They can do a health insurance comparison that will contrast the benefits and costs to the person.
- People think everyone qualifies for benefits under COBRA. That is not the case. The law specifies the eligibilities. If an employer drops health care benefits, employees are not entitled to any protection under COBRA. This mistake goes back to assumptions. People should never make assumptions, but instead they should ask questions to find out if they are qualified.
- Many believe that COBRA is medical insurance. It is not. COBRA is an acronym that is short for the Consolidated Omnibus Budget Reconciliation Act. It is a law enacted to help people continue employer sponsored health insurance for a short period of time.
Health insurance agents work on behalf of the person buying insurance. They can offer consultations that help people understand all of their options in relation to health care coverage. They often have access to Blue Cross/Blue Shield, Aetna health insurance plans, and plans offered by other companies.
Posted on Wed, Dec 10, 2008
With unemployment possibly reaching as high as 9% in the next year, BestHealthcareRates.com is fielding a record number of questions about COBRA alternatives for family health insurance plans. Contrary to popular misconceptions, COBRA is not a health insurance plan; rather, it is a law named the Consolidated Omnibus Budget Reconciliation Act. COBRA protects employees in the event they lose their employer-sponsored health benefits. Qualified employees may keep the dental and medical insurance they had under their employer for 18 months. However, because the former employee carries the entire cost of the insurance policy – up to 102% of the original premium, the cost of maintaining insurance can be prohibitive.
Uncertain economic times are driving already financially-stressed employees to seek a more affordable COBRA alternative. BestHealthcareRates.com offers more affordable family health insurance plans than what the employer based plan would provide. By doing health insurance comparisons, one can get similar, lower cost benefits by taking a COBRA alternative. Often, the former employee is not at all aware of their options and they needlessly stay with a higher cost plan. Once they see the benefits of a COBRA alternative, they opt out of their former plan. Dental and medical insurance can be found in these COBRA alternatives too. Without a COBRA alternative, the unemployed may be paying much more than they need to at a time they can least afford it.
“If you have a disability, you may need to opt for your employer’s coverage but can still get a COBRA alternative for the rest of your family,” said Tom Carolan, Director of Client Services with BestHealthcareRates.com. “Again, by making a health insurance comparison, you will see the great potential savings that exist for your family even if you, as an individual, remain on the employer plan. A cost-cutting COBRA alternative is essential for many households even if the coverage is for the rest of the family.”
Posted on Fri, Dec 05, 2008
BestHealthcareRates.com reports with unemployment expected to rise to 9% by next year many families will, most likely, be forced to decide whether to take their employer’s COBRA health insurance or look at alternatives provided in the marketplace. Losing employer health insurance is a challenge at any time, but during a recession the choices seem harder for families trying to budget. COBRA alternatives exist, but consumers are not always aware of the options, often at a considerable cost difference from the employer based plans.
As individuals begin the long search of finding a new job or alternative employment they often decide to opt out of their employer based COBRA plans because the cost is too steep. These newly unemployed are now newly uninsured, but it doesn’t have to be like that – they can get the help they need with cost cutting COBRA alternatives. COBRA health coverage is required to be offered by the law, to provide coverage to your family in case of layoffs, but the costs are often out of reach for a family that is currently undergoing a loss of income.
Tom Carolan, Director of Client Services with BestHealthcareRates.com, states, “COBRA coverage is required by employers but it often isn’t the best financial decision that a family faced with unemployment should consider.” His company offers a comprehensive look at the alternatives to COBRA coverage that individuals and families can research for their continued health care needs.
Carolan continues, “Those aged 20-35 who are laid off often think that they don’t need health coverage because they are relatively healthy. This group in particular should consider that with the rate of unemployment and health care costs rising, purchasing a lower cost alternative to the COBRA plan can continue to maintain their health and alleviate any further financial burden that a health crisis would create.”
Consider that COBRA is an expensive option because although employers are required to provide it, they do not pay for any portion of the monthly premium as they did when you were employed. Unfortunately, you might be required to pay up to 102% of the monthly premium in order to continue coverage under your employer’s COBRA plan. If you have a disability and continue your coverage by extending your COBRA you could be required to pay up to 150% of the plan. These costs are often a burden that a family cannot afford to budget the necessary payments to keep their coverage. If you have pre-existing health problems a COBRA plan may be your only option, but you might consider an alternative health plan for your spouse or children until you have retained employment to cut your health care costs.
Looking into alternative health insurance options is liberating for many family’s. It allows them to see the options in health care that their employer is not required to represent. Finding a health coverage plan that meets your families needs and budget can be accomplished with just a little research into what is available online.
During this time of economic fragility being smart about your health care coverage decisions will become a saving grace. Having good information is critical and knowing what is available for your health care needs will provide needed peace of mind. Even if you are relatively healthy it is a wise choice to get smart about health care coverage for yourself or your family – knowing your alternative choices to COBRA benefits offered by your employers will save you money until you have the secured employment and employee based health coverage in the future.
Posted on Thu, Oct 30, 2008
Since first being signed into law in December 2003 by the Federal Government, Health Savings Accounts are already a proven “hit” & are here to stay. They are literally available to every legal adult in the United States.
Knowledge is power when it comes to your finances. Medical Insurance has now become the newest form of an investment vehicle offering tremendous financial & tax benefits. Today, opening a Health Savings Account in partnership with an HSA qualified medical insurance plan offers many special financial advantages. And for the most part, they are simple to understand.
A Health Savings Account enables consumers to:
· Maintain access to a wide PPO network and in most cases provides coverage for seeing your current doctors and specialists.
· Lower your health insurance premium by 25% – 50%. One can typically save between 80 to 250 dollars per month when they change their plan over from a traditional health insurance plan to a HSA qualified high deductible health plan. Now don’t be deceived. Yes, you’ll now have a high deductible, but there are plenty of safety nets to protect you if necessary. The first step to take is to place monies saved from your new lower premium into your Health Savings Account. This doesn’t cost you anymore than what you were paying before…you are just putting the money in a new place.
Next, enjoy IRS created HSA triple tax advantages. Reduce annual out-of-pocket income taxes up to $2,000. Save EVERY year on taxes from here on out. Below are your three main tax saving pillars.
- Contributions to your HSA are 100% tax free.
- Interest on all of your account investment gains are also 100% tax free.
- The type of investments are your
choice and range from low-interest, no risk, lower bank rates to the widest range of stocks, bonds, & mutual funds. The level of risk is up to you.