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Today's Topic

With open enrollment season approaching this fall for Employers, Medicare and Health Insurance Exchanges, what major concerns or observations are in the forefront from your perspective?"

Vince Kuraitis
 Vince Kutaitis

Vince Kuraitis
Better Health Technologies, LLC

In the next year, the big issue will be around benefits adequacy, i.e., lack of coverage and high out-of-pocket expenses incurred due to high deductibles, co-pays, exclusions, etc. My shorthand for this is "Swiss cheese health insurance-so, so many holes."

The canary in the coal mine is a recent letter signed by 333 patient advocacy groups to HHS Secretary Sylvia Burwell. The Letter describes three concerns around benefits adequacy, "especially (for) those with chronic health conditions": 1) Limited Benefits, 2) High Cost-Sharing, 3) Transparency and Uniformity.

The issues here are tough and not amenable to easy, quick solutions. Curious about the details? Read my blog post on this topic.

"You can't keep your doctor AND you get Swiss cheese health insurance." That's NOT a very uplifting tagline for the newly insured.

Mark Lutes
   Mark Lutes
Chair, Board of Directors,
Epstein Becker & Green, P.C.

This question spans at least three markets -- commercial, Medicare Advantage and Exchange mediated products. There are different dynamics at work in each. In the commercial market employers are watching to see whether the resumption of the climb of medical cost trend will, in conjunction with the Cadillac tax, move them closer to a defined contribution/private exchange choice.

 In the Medicare Advantage market, plans are battling for higher star ratings, absorbing cuts and digesting the application of MLR rules. In the exchange world, payors are seeking better definition of the risk pool while dealing with shifts in the competitive landscape.

However, what is cross cutting among these markets is the open question of whether the medical expense line can be moved by value based purchasing and whether consolidation in markets will cause price increases that eat into any gains from those developments.

Self-funded employers and payors with insured products (commercial, MA or exchange) have shared interest in the proliferation of value based payment methodologies -- although their spread is inhibited by the work entailed in framing and negotiating the terms, limited data capabilities and lack of consensus as to what the "low hanging fruit" is among risk methodologies to be implemented.

Of equal concern is the inability of limited (single product or payor) innovations to "move the needle" and capture provider attention given the diffusion of patients across insured arrangements. Absent additional progress in "all payor" value based purchasing the issue for all these markets could be the absence of fundamental positive improvement in cost trend.

 Krista Burris
Krista Burris

Krista Burris
HealthCare Strategy Consultant


As healthcare transitions to a consumer-driven environment, all constituents must make the necessary adjustments to support individual accountability in selecting the benefits that are most appropriate for their coverage needs. Fundamentally this translates to infrastructures with sophisticated decision support resources and communication strategies that educate employees, Medicare beneficiaries, and individuals on their benefit options.

What's top of mind for me as open enrollment approaches is are consumers educated on their options and how to make the best coverage decision for their needs. As employers aim to better control costs of providing healthcare for their employees, there is a focus on the redesign of employee total rewards packages, specifically related to health benefits, wellness, and ancillary/voluntary.

Educating employees on benefit options and providing appropriate incentives to enroll into higher value benefit packages is key to promote the "right-sizing" of benefits. This becomes increasingly important as exchange marketplace adoption accelerates putting insurance purchasing decisions in a retail-setting.

Providing the right tools and resources to improve the financial literacy and out-of-pocket implications of benefits is critical to the success of exchanges. The exchange model is still relatively early in scaling but technology that offers robust and sophisticated decision support will facilitate open enrollment as employee benefit distribution models become consumer-driven.

  Lindsay Resnick

Lindsay Resnick
 Principal, KBM Group

It's all about the customer!

For consumers, open enrollment means a series of challenging decisions. It's a time to shop, compare, switch or stay with a current plan. But let's face it, on a good day health insurance is a confusing, bureaucratic labyrinth. And for the most part, consumers are not confident insurance buyers. A recent Urban Institute survey shows that half of individuals with health insurance don't understand basic insurance concepts. For those going into the buying process without insurance the knowledge gap deepens dramatically.

Beside the avalanche of acronyms (IEP, OEP, AEP, SEP), open enrollment brings a bombardment of direct-to-consumer messaging - TV commercials, direct mail, online banner ads, etc. all making bold promises and playing one-upmanship with competitors. As health plans place the burden of choice squarely on the shoulders of the customer-selecting the right plan, budgeting for premiums, and choosing provider networks-consumers want a trusted advisor as they step into the role of prudent health insurance buyer.

Trust is a key word here. In a recent healthcare survey of 34,000 consumers probing their relationship with and attitudes toward healthcare insurers and providers, only 22% said they trust insurers and even fewer, 12% say they rely on insurers as a source for health advice or information...sobering statistics for insurers looking to influence prospects and customers about coverage options and health behavior.

If we expect consumers to take greater personal responsibility and stay involved in health benefit decisions, they need to be educated and engaged. Every touch-point throughout the healthcare customer journey must be driven by an integrated communication stream that deepens engagement through useful, personalized interactions and customer value exchange. Informed consumers will drive better upfront economic decisions and ultimately, better health and financial outcomes.

Health insurance brands are now inseparable from their ability to engage the customer and build trust. They must provide customers a reason to engage by guiding them through healthcare's maze of choice and rewarding them with interactions that do the right thing for their healthcare. Success hinges on setting realistic expectations, clarifying rules of engagement, and providing continuous customer education throughout the member lifecycle. It means delivering responsive, understandable content to the consumer on their terms, through channels they consider most relevant.

 Henry Loubet
 Henry Loubet

Henry Loubet
 Chief Strategy Officer

The Affordable Care Act (ACA) is preparing to open the second act and will be more organized and structured than in year one.   Because the Employer Mandate provisions were delayed for a year, last fall's open enrollment was a real beginning. At this point, it appears this year employers will actually face penalties and be required to report on the status and enrollment of their employees to the IRS. Plan sponsors who are not in compliance will need to get things together now.

Employers should already have a plan in place to track their variable hour employees and decide which method they will use - either the lookback or month-by-month approach - to determine which employees must be offered employer health coverage. There are a number of tools for employers to handle tracking, with the major considerations for choosing being cost, available internal resources and compatibility with payroll systems.  Our organization, Keenan, has developed arrangements with two organizations to offer this service.  As the IRS issues the final forms and instructions for Code Sections 6055 and 6056 reporting, employers will also have to determine where the data elements will come from to complete these reports. In California, new legislation was enacted to extend grandfathered plan protection to groups under 50 employees for another year.

The public sector and health care employers we work with have employee segments that are not always benefit-eligible. As many of these individuals endured the challenges and wait times in dealing with the exchanges and their sometimes balky web sites, employers may expect that enrollees will have numerous questions. It is estimated that a number who enrolled in an exchange plan during the last open enrollment will make a change for 2015, with considerable focus on dissatisfaction with provider networks which have been expanded in a number of cases.  It does not cost them anything additional to use the assistance of a certified Agent or Broker and they may better avoid delays and slow response times as well as gain valuable information in making these decisions for members and their families.

Public agencies also need to consider their retiree participants and how options available through a Medicare Exchange can help to mitigate their retiree liabilities for health benefits. A new Exposure Draft from the Governmental Accounting Standards Board (GASB) includes provisions that public agencies will need to report unfunded liabilities, not under a qualified trust, on the face of their financial statements. Using a defined contribution approach, such employers can direct their retirees to a Medicare Exchange and effectively reduce their liability.  We at Keenan offer Futuris Care, our retiree exchange, which is an increasingly popular offering which is one of the fastest growing areas of our business.


Upcoming Webinars: 

Managing Advanced Illness though Population Health Management, September 12, 2014
National Medicaid Transformation and Provider Collaboration Web Summit, September 19, 2014
Current ACO Market Consolidation and Antitrust Issues, October 3, 2014
ACA Plan Sponsor Roadmap for 2015 - Current and Upcoming Compliance Challenges, October 10, 2014
Benchmarking Bundled Payments - Medicare PAC Utilization Benchmarks, November 13, 2014
Accountable Care Web Summit, December 11, 2014 
Post-Event Materials from Past Events


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