Useful tool. Order confidential lab tests w/o doctor visit. Direct access labs provides key biometric tests; http://bit.ly/dm7faP

Deductible: the amount you must pay before an insurer will cover any of your expenses. This cool video does a good job explaining this often confusing term: http://bit.ly/blyIxH

This week in healthcare reform and a few other things...

The debate over health care intensified this week as House members returned to their districts and the Senate prepared to adjourn for the remainder of August. Many House members held town hall meetings with constituents this week, adding fuel to the health care debate.

Public Plan
 
House Committee on Energy and Commerce Completes Markup: After weeks of negotiation, the House Energy and Commerce Committee was the last of three House committees to complete work on sweeping health care reform legislation. The committee approved the bill on a vote of 31-28, with all Republicans and five Democrats voting against the bill. The vote clears the way for the legislation to move to the House floor.

Alternative Plans
 
Senate Finance Committee Delays Until September: Senate Finance Committee members confirmed that they would not complete a draft bill before the August recess and that negotiations would continue into September. After a meeting with President Obama Tuesday, Senate Finance Committee Chairman Sen. Max Baucus (D-MT) has set a mid-September deadline for completion of a bipartisan bill. President Obama pressured Senate Democrats to move forward with health care reform if a bipartisan bill cannot be reached; he vowed Wednesday to get a reform bill through Congress this year even without Republican support. President Obama will meet with six negotiators from the Committee Thursday at the White House to discuss the bipartisan bill.

Financing the Plan
 
Obama Renews Pledge to Not Raise Middle Class Taxes but Remains Open to Taxing Health Insurance: White House officials scrambled to retract statements made by top economic advisors last Sunday, indicating that a tax increase on the middle class is an option to pay for health care reform. However, President Obama remains open to a proposal to tax health insurance.

***(My thoughts below are not about the best plan from a political viewpoint nor an objective summary of the current proposals being discussed. That information is difficult to find as there is quite a bit of disinformation in the media. Rather,an appeal to you as the reader, business owner or individual to review your current health insurance plan - added 8.8.09).***

What do I think of all this? As all of this goes on there are, in my opinion, a lot business owners, public entities and non-profit(s) can do to be proactive and drive change in their respective organizations to realize bottom line savings.

Despite the debate and the continued rising costs those who are embracing wellness, consumer driven health plans and alternative funding strategies are seeing terrific results! Those who are slow to change will continue to see very large, double digit increases and only have two options; both of which are cost shifting - change your deductible or lower your contribution.

Why not rather spend a little time learning about options that are available now? Regardless of the outcome, public or private, as a business owner or individual you will still need to analyze the cost benefit of the plan you choose.

We have put together multiple proposals for companies with 2 employees to those with 100's and in each scenario we are seeing significant savings and, often, increasing the coverage. There is typically a little more administration and some education but how hard are you willing to work to save 20-50% on one of the most expensive costs within your organization and/or to your family?

If you have watched the shift in plan options from all major carriers in California (Kaiser, Blue Shield, Blue Cross, Aetna, Health Net and UHC) over the past 4 years you will have seen the same emphasis. There is an increasing wave of offerings focused on transparency, consumer driven plans (HSA, HRA, FSA, HIA - way too many acronyms), wellness programs/integration and voluntary gap products. There is still a lot of skepticism.

Many times it was brokers engaging the carriers to push for alternative plans and products and now the adoption is accelerating at a rapid pace. Most of the discussion at a National level is about pouring money into IT infrastructure, pushing for more transparency in regard to costs and utilizing consumer driven plans so that consumers (you and I) will take more responsibility. The California market is doing the same thing. Kaiser has led the way but others have are doing the same.

Just last month the National Association of Actuaries (a group of very smart, number crunching individuals) published a report on the short and long term savings (or lack thereof) with HSA and HRA plans. If you would like a copy email me and I'll be happy to send it to you. The findings? They work for both short-term savings and long-term savings. And the early studies show that they are changing behavior.

So let's talk. What are you waiting for? In almost every one of the companies that have decided to work with us over the past 8 weeks we have done the analysis and these type of plans have, hands down, been the best option; for both savings and for coverage.

Whether you want to change from your current broker or not give us a call and we would be happy to provide for you the education and the analysis.

Health Reimbursement Arrangements (HRA's)

If you are like most business owners, you are frustrated with the high cost of health insurance. The new administration is, like past ones, continuing to discuss alternatives.

Until the time comes that someone comes up with a plan it makes sense that you would continue to look for competitve, cost saving alternatives. In these tough economic times it's tougher than ever to increase profits let alone face high insurance costs.

One option to consider is to consider educating yourself on consumer driven healthplans. There is alot of information circulating in regard to these plans. They include a number of options including HSA, HRA, FSA (both employee and employer sponsored) and CDHP plans. For informatio on what these mean watch one of the videos on our partner links.

Today I will focus on HRA's otherwise known as Health Reimbursement Arrangements. HRA's have been around for a couple of decades and, yet, are not widely understood. If you are a large employer you have the ability to enter into a self-funded plan and typically, if designed correctly, capture some savings by taking on some additional risk and managing your plan expenses and administration.

In the small group (under 50 employees) the risk associated with self-funding is usually too high. However, an HRA allows you to accomplish a similar model without the risk. You purchase a high deductible plan (typically 30-50% savings). With the savings you put together an analysis that wil allow you to reimburse your employees a good portion of the deductible when they do to a doctor. If designed correctly you can realize great savings and improve the benefits offered to your employees.

Along with HSA plans HRA's are one of the fastest growing plans among several carriers on the market today. In January Kaiser released two new HRA plans. Today (April, 1 2009) Aetna is releasing a couple of extremely competitive HRA plans. If implemented correctly you can anticipate 20-40% savings without much change in the benefits offered to your employees.

Advantages of HRAs for employers include: (wikipedia)

• 20-40% Savings to your bottom line.
• Only contribute if employee goes to doctor.
• Reimbursements of qualified claims are tax-deductible for the employer.

Advantages of HRAs for employees include:

• Contributions that employers make can be excluded from employees' gross income.
• Reimbursements may be tax free if the employee pays qualified medical expenses.
• Unused funds in the HRA can be rolled into future years for reimbursement.
• HRAs may be offered in conjunction with other employer-provided health benefits including Flexible Spending Accounts (FSAs).
• Employees do not have to be covered under any other health care plan to participate, unlike (for example) a Health Savings Account (HSA) which requires a High Deductible Health Plan.

You can look at Aetna's detail here. For more information and a complete analysis, give us a call at 650-533-8387 or send us an email.