individual health insurance

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Blue Shield of CA and Sutter Health: Negotiating a new contract

From Blue Shield today:

Blue Shield and Sutter Health are engaged in contract negotiations
Blue Shield of California and Sutter Health are engaged in discussions on rates and terms for a new network contract (HMO/PPO and in some cases, Group Medicare Advantage). The current contract is set to expire at the end of this year and without a new deal, Sutter Health would no longer be a Blue Shield in-network provider starting January 1, 2017.

We are working diligently in good faith to complete a new contract that is fair and sustainably affordable for our customers. If the network relationship terminates, Blue Shield will ensure that members have continued access to care in their area, including continuity of care for those who qualify to continue in their current course of treatment with a Sutter Health provider.

What are the lines of business affected by the negotiations?
The contracts being negotiated apply to all Blue Shield plan types, including HMO, PPO, EPO, POS-HMO Tier, POS-PPO Tier and Group Medicare Advantage.

  • Individual and Family Plans: Grandfathered and Non-Grandfathered Plans (on and off exchange)
  • Medicare: Group Medicare Advantage Prescription Drug (GMAPD) plans
  • Small Business (1-100 employees)
  • Fully Funded Large Employers (101+ employees)
  • Self-Funded/ASO Large Employers (101+ employees)
  • Self-Funded/Shared Advantage (101+ employees)
  • CalPERS
  • FEP

Sutter Health providers are located in Northern and Central California (see listing of counties below). In addition, Sutter Health has surgery centers in San Diego County.

Sutter Health Counties
Alameda Marin San Joaquin Santa Cruz Sutter
Amador Merced San Luis Obispo Shasta Yolo
Contra Costa Placer San Mateo Solano
Del Norte Sacramento Santa Barbara Sonoma
Lake San Francisco Santa Clara Stanislaus

The contracts currently being negotiated include the following Sutter Health hospitals:

  • Alta Bates Medical Center Herrick Campus
  • Alta Bates Summit Medical Center Alta Bates Campus
  • California Pacific Medical Center – California Campus*
  • California Pacific Medical Center – Pacific Campus*
  • California Pacific Medical Center – St Luke’s Campus*
  • California Pacific Medical Center Davies Campus*
  • Eden Medical Center
  • Memorial Hospital Medical Center
  • Memorial Hospital of Los Banos
  • Menlo Park Surgical Hospital
  • Mills Peninsula Health Center
  • Mills Peninsula Medical Center
  • Novato Community Hospital
  • Sutter Amador Hospital
  • Sutter Auburn Faith Hospital
  • Sutter Center for Psychiatry
  • Sutter Coast Hospital
  • Sutter Davis Hospital
  • Sutter Delta Medical Center
  • Sutter Lakeside Hospital
  • Sutter Maternity and Surgery Center of Santa Cruz
  • Sutter Medical Center of Santa Rosa
  • Sutter Medical Center, Sacramento
  • Sutter Roseville Medical Center
  • Sutter Solano Medical Center
  • Sutter Surgical Hospital North Valley
  • Sutter Tracy Community Hospital

    *Includes Medicare Advantage

In the event of a termination with Sutter and in accordance with DMHC regulations, Blue Shield of California would notify HMO members assigned to a Sutter Health Primary Care Provider (PCP) 60-days in advance of a potential termination with Sutter Health. PPO members with an out-of-network benefit could receive services from a Sutter-affiliated provider, but the out-of-pocket costs will be at the non-preferred benefit level.

Our commitment to affordably priced health coverage
Blue Shield continues its provider contract discussions with Sutter Health in hopes that new agreements will soon be reached. We appreciate your patience while we work to secure the best possible outcome for our customers and members. Our goal is to provide our members with access to quality health care at an affordable price.

Emergency services
Blue Shield of California members who need emergency services should call 911 or seek care at the nearest emergency room. Blue Shield will provide the full emergency care level of benefits for these services.

Oscar is coming to San Francisco

Oscar is coming in 2017. No, not that Oscar.

A new health insurance carrier will offer plans both on- and off-exchange, in San Francisco, San Mateo, and Santa Clara counties. A little surprising it took this long, considering they are Google-funded, and we’ve heard them described as “great software – with health insurance attached.”

It appears their Bay Area rates and network will be middle-of-the-pack (current word is no Sutter Health/PAMF, though that could change). Will their customer service and user experience be enough to consider Oscar as a viable choice? Stay tuned.

How to save $1,000 in health premiums over the next 4 months

This isn’t a strategy for everyone. If you feel bad for the insurance companies, you can stop reading now. And if you have any significant health issues, this won’t work for you, either. But, if you:

  • Have had minimum essential coverage from January 1 through October 31 of this year
  • Are healthy, with no (or minimal) foreseen health expenses for the next few months
  • Are willing to take a few minutes to understand the rules and exceptions around:
    • Open enrollment
    • Guarantee-issue health insurance
    • Individual mandate to purchase minimum essential coverage
  • Would prefer to pay the lowest possible health premium, without subjecting yourself to financial risk or tax penalty

…then this could be for you.

Read More

What To Do With This Blue Shield Rebate Check?

Small businesses and individuals will be receiving a rebate from Blue Shield by August 1st.  Employers, please review the details here, about valid ways to return these refunded premiums to your employees.  Reducing the cost of future insurance coverage is a legitimate use of the rebate.

From Blue Shield:

Medical Loss Ratio Rebates and Notifications

Last month, we informed you that Blue Shield reported its 2012 Medical Loss Ratio (MLR) by market segment to the Department of Health and Human Services (HHS). We are now sharing our rebate information with you.

Blue Shield did not meet the MLR thresholds for the following market segments:

  • Individual and Family plans regulated by the Department of Insurance (DOI)
    The MLR threshold for this market segment is 80%. Blue Shield reported an MLR of 78.0%. The Individual and Family plan MLR was 2% below the 80% threshold. As a result certain subscribers will receive premium rebates by August 1, 2013. The 2% of premium revenue equals $13.3 million that will be returned to 226,034 Individual and Family plan subscribers who were enrolled in the Blue Shield Life plans that did not meet the MLR threshold. The average rebate amount per subscriber is about $59.
  • Small Business plans (50 or fewer employees) regulated by the Department of Managed Health Care (DMHC)
    The MLR threshold for this market segment is 80%. Blue Shield reported an MLR of 76.6%. The Small Business MLR was 3.4% below the 80% threshold. As a result, certain subscribers will receive dues rebates by August 1, 2013. The 3.4% of dues revenue equals $24.5 million that will be returned to 29,232 Small Business policyholders who were enrolled in the Blue Shield plans that did not meet the MLR threshold. The average rebate amount per Small Business policyholder is about $827.

New Yorkers to Pay 50% Less for Health Insurance – NY Times

In yesterday’s NY Times, it was reported that individual health insurance premiums are expected to drop by 50% in 2014, when the full effect of the Affordable Care Act (a.k.a., “Obamacare”) kick in.  Here is the most shocking line in the article:

Because the cost of individual coverage has soared, only 17,000 New Yorkers currently buy insurance on their own.

New York state is home to almost 20,000,000 (that’s TWENTY MILLION) people.  And 17,000 of them buy their own health insurance.  According to the article, 2.6 million go uninsured.  Let’s let those numbers sink in for a moment.

New York is one of a handful of states that already has guarantee-issue coverage for individuals.  That is, medical underwriting does not exist; any individual can purchase individual coverage, even those with expensive, chronic diseases.  How many of the 17,000 do you think are completely healthy individuals, who do not receive coverage from an employer?  Right.  Well, no wonder the average cost to an individual is $1,500/month for these individual policies.  OK, here are a couple of takeaways:

  • The individual mandate — the requirement that all individuals purchase qualified health insurance in 2014 or pay a penalty — is crucial to the success of the Affordable Care Act.  We must force healthy people into the system, in order to sustain a competitive marketplace that benefits all individuals.
  • Can that 17,000 number possibly be correct?  Is it really true that 13% of New Yorkers go uninsured, 87% get their health insurance from an employer, and less than one-tenth of one percent purchase their coverage on the individual market?  California has twice as many residents as New York, and somewhere between 500,000 and one million purchase their own individual health insurance.

I will do a little more fact-checking and report back…

Interest in HSA’s Continues for Small Business and Individuals

More than eighty percent of my small business clients offer an HSA-compatible health plan as an option to their employees. Some of them partially fund accounts for the employees to help offset the high deductibles, and still find that this is the most cost-efficient way to finance employee health care.

Ditto for individuals and families. It is particularly pleasing to help a family paying $1,000 – $1,500/month on COBRA or a small business plan realize that they could save $10,000/ year in premiums by switching the family to an HSA-compatible plan from their choice of carriers.

More on this trend, from the Kaiser Family Foundation, here.

Anthem Blue Cross rate hikes

Even if you are not an Anthem Blue Cross subscriber, it would be hard not to have heard about the recently announced rate hike for many California subscribers.  If not, you can read about it here (LA Times, 2/14), here (SF Chronicle, 2/14), and here (NY Times, 2/16).

For additional perspective, here is the full letter of explanation written by Brian Sassi of Anthem Blue Cross in response to Health and Human Services Secretary Kathleen Sebelius’s inquiry into the rate increases.

A couple of key points, without getting into the meat of the debate:

  • The rate increases are affecting Anthem Blue Cross individual subscribers, not small business subscribers
  • Anthem has delayed the increases for two months (to May 1) while the issue is investigated

We understand that a number of our individual clients may be experiencing an increase in rates — and not necessarily just from Anthem.  Please remember that we are always here to assist you.  Contact our office via email or call (888) 992-2244 to schedule an an appointment to discuss whether a different plan or a different carrier is the right choice for you.