June 29, 2013, 8:16 a.m. EDT
Obamacare could eat up your raise
Health law prompts more companies to use salary-based premiums
Expecting to get a raise next year? It could be eaten up by your health care bill.
In an effort to meet the affordability requirement of the Affordable Care Act, which kicks in next year and requires that workers spend no more than 9.5% of their income on premiums, more employers are turning to insurance plans in which premiums vary based on a person’s salary, rather than having all workers pay a flat rate. That way, employees who make more money pay bigger premiums.
Some 12% of companies used salary-based premiums in 2012, up from 10% in 2011, according to a study by benefits consultant Mercer. The practice is especially common among large employers, with 20% of companies that have at least 5,000 employees using the strategy last year. A separate survey by the Kaiser Family Foundation found that the approach of varying premium contributions by wage level is more popular in the Northeast, where 9% of companies used the strategy, and in the Midwest, where 6% of employers did, compared with 2% of companies in the South and the West.
While the strategy, which some employers have been using for decades, is still not mainstream, more companies are adopting the system as a way to prepare for the health reform law. It makes sense for some employers to shift costs to wealthier workers, especially as health-care costs continue to grow at a faster clip than wages, says Tim Nimmer, chief actuary and chief broking officer with Aon Hewitt, a human-resources consulting firm. Companies feel more comfortable “putting that increase on their higher earners just because they can afford it,” says Nimmer. If premiums increase by $100 for a company’s chief executive it may seem “meaningless,” but “for someone making $25,000, it could be the difference between going out to eat or paying electric bills or buying gas,” he says.
The average total monthly premium for full-time employees grew to $832 this year, up nearly 14% from $731 in 2010, according to a study released by the ADP Research Institute this week. And those costs are taking up a larger percentage of income for lower-wage workers, the study found, with premiums taking up 8.4% of income for workers earning $15,000 to $20,000, up 0.9 percentage points from 2010 when premiums took up 7.5% of income. Workers earning more than $120,000, in contrast, paid 2.1% of their annual income on premiums.
Some companies will set up salary “bands” where they increase premiums in small increments of $5 or $10 based on income. Workers earning $25,000 to $50,000 may pay one rate, $50,000 to $100,00 another rate, and so on, says Nimmer. At some companies, the premium costs between lower wage workers and higher earners could vary by as much as 20%, he says.
June 26, 2013, 8:43 a.m. EDT
Young Americans may dodge health law
For 20-somethings, penalty may be preferable to buying insurance
By Jen Wieczner
Young Americans may have been among the biggest supporters of Obamacare, but they may also be the least likely to comply with the law.
The architects of health reform say the law will make insurance more affordable and widely available. But in 2014, benefits experts say, the cheapest option for 20-somethings will be to pay the penalty for not buying health insurance, rather than paying for any health insurance at all—that is, provided they don’t get sick.
And as more young people do the math, more seem to be deciding the Affordable Care Act isn’t such a good deal for them: Support for a national health-care plan dropped nearly 11% among American college freshmen between 2008 to 2012, with under 63% in favor of it today, down from 70%, according to UCLA’s annual student survey.
Next year, uninsured Americans must pay a penalty of $95, or 1% of their annual salary if they make more than $9,500 for the year. A person earning $50,000, for example, would pay a $500 penalty if they chose not to enroll in a health insurance plan.
But for a healthy 20-something who rarely goes to the doctor and doesn’t take prescription medications, that penalty might be far less expensive than buying a health plan through the state health exchanges, the new insurance marketplaces opening Oct. 1. Those exchanges, which will offer health coverage to people who can’t get it through their employer or by staying on their parents’ insurance, are just beginning to announce how much their plans will cost. But based on the rates released so far, the price of health insurance for a 20-something will start at about $72 a month in Washington, D.C., and $117 a month in California, for minimal coverage known as a “catastrophic plan,” available to people under 30.
That means that for someone making less than $86,400 in Washington, D.C., or less than $140,400 in California, even the cheapest health insurance would still cost more than the penalty (a 1% penalty on an $80,000 salary, for instance, would be $800, while the lowest-price insurance in Washington would cost $864 a year and in California, $1,404).
And the bare-bones plans also have high deductibles, so 20-somethings in the least expensive Washington plan would still have to pay $6,350 in medical bills before the insurance company would start to pick up the tab—a calculation that could lead more young people to see the penalty as a comparative bargain: “The concern is,How many of them will even forgo that plan and just take the penalty?” says Caroline Pearson, a vice president at Avalere Health, a health-care advisory firm.“That’s what were waiting to see.”
Contraceptives Stay Covered in Health Law
By ROBERT PEAR
WASHINGTON — Despite strong resistance from religious organizations, the Obama administration said Friday that it was moving ahead with a rule requiring most employers to provide free insurance coverage of contraceptives for women, a decision that has touched off a legal and political battle likely to rage for another year.
The final rule, issued under the new health care law, adopts a simplified version of an approach proposed by the government in February to balance the interests of women with the concerns of the Roman Catholic Church and other employers with religious objections to providing coverage for contraceptives.
After considering more than 400,000 comments, administration officials refused to budge on the basic principle. The rule, they said, is very similar to their proposal. An exemption is included for churches. But many Catholic hospitals, schools, universities and other religious institutions will have to take steps so that coverage is available to employees and their dependents.
The issue figured prominently in last year’s elections as President Obama and other Democrats pressed their advantage with female voters. At the same time, Catholic bishops waged a national campaign arguing that the federal policy infringed on religious freedom and violated the church’s social and moral teachings on birth control and abortion.
Cardinal Timothy M. Dolan of New York, president of the United States Conference of Catholic Bishops, said the group was reviewing the final rule.
Democrats describe the mandate for coverage of birth control as one of the chief benefits of the 2010 health care law, a boon to women and their health.
“The health care law guarantees millions of women access to recommended preventive services at no cost,” said Kathleen Sebelius, the secretary of health and human services. “Today’s announcement reinforces our commitment to respect the concerns of houses of worship and other nonprofit religious organizations that object to contraceptive coverage, while helping to ensure that women get the care they need, regardless of where they work.”
Republicans say the requirement shows how intrusive and onerous the law is.
Health-Centric Homes, for a Price
By ROBIN FINN
Coming soon to a neighborhood near you: an empathic multimillion-dollar home that passively treats the occupant’s body like a temple. The second coming of sustainable real estate, it will fuse green technology with nourishing all-about-me amenities and direct them indoors. Homebodies, take note: the residence is designed to make the people it shelters healthier.
“The simplest way to understand what this home is capable of doing is to think of it like a 24-hour carwash that works on the human body,” said Paul D. Scialla, a co-founder and the managing partner of Delos, the Manhattan real estate firm. After conducting years’ worth of medical studies on the soundness of the science behind its product, Delos is about to make its debut in the city’s luxury marketplace with a WELL-certified condominium (the Delos name and the concept are trademarked).
The five health-centric residences are at 66 East 11th Street, an address where living well is, to recycle a throwaway line attributed to the 17th-century poet George Herbert, about to become the best revenge. Construction is under way; the first loft is scheduled to be habitable in September.
The purest air and water and the most intense soundproofing are promised: there is a buildingwide water purification system; filters will screen out air pollutants, allergens and toxins; and a circadian lighting system will stream energizing light in the morning and melatonin-enhancing light in the evening. Then there’s the posture-supportive flooring system and the WELL Shield coating, which destroys bacteria in the kitchen and bathrooms.
Mr. Scialla believes in his invention so sincerely that he retired this spring, at 39, as a Goldman Sachs partner to devote himself to Delos. The guinea pig for the project was the West 13th Street loft where he and his twin brother, Peter, live.
Renovated in 2012, the loft is stocked (subtly and in some cases invisibly) with 50 wellness amenities that deliver, he says, 23 therapies: exponentially improved air, water, light, sleep, energy and nutrition are all part of the package. The grand piano in the living room is an extra that belongs to Peter — music being the rare form of therapy, Mr. Scialla said, that Delos doesn’t cover.
The interior lighting in the West 13th Street prototype where the twins live with their golden retriever, Jake, nourishes delicate circadian rhythms with constantly changing types of illumination and blackout shading. The air is not just continually cleansed, but subtly infused by aromatherapy appropriate to the time of day — or the owner’s whims.
The rift-cut Siberian oak floors are set upon a layer of cork and rubber that reduces stress, muffles sound and nudges a body toward perfect posture. The juice bar in the kitchen enables healthy beverage selections. The blue-light panel surrounding Mr. Scialla’s bathroom mirror is a silent wake-up call even on the darkest mornings. The heated stone path to the shower provides instant foot reflexology, and inside the shower, the cascade is supplemented by a spritz of vitamin C and aloe that neutralizes chlorine and soothes the skin.
Is this a great country, or what?
-SPC
Maine Medical Center will offer buyouts to about 400
Posted: June 28Updated: Today at 12:22 AM
'Financial challenges' prompted Maine's largest hospital to look for ways to reduce its expenses.
PORTLAND — Maine Medical Center plans to offer about 400 employees voluntary early-retirement buyouts, according to a memo obtained Friday by the Portland Press Herald.
In the letter to employees, Richard Petersen, president and CEO of Maine's largest hospital, said "financial challenges" have led the hospital to look for ways to reduce "all labor and non-labor expenses" to "improve our financial stability moving forward."
"We're going to offer incentives for voluntary early retirements for about 400 people across Maine Medical Center. More information will be communicated about this program next week," Petersen wrote.
Maine Med, which announced a hiring freeze this spring, has about 6,000 employees.
Maine Medical Center to offer buyouts to 400 workers
Posted June 28, 2013, at 5:43 p.m.
PORTLAND, Maine — Financial losses have prompted Maine Medical Center to offer voluntary buyouts to about 400 employees approaching retirement.
In an internal memo to employees Friday, provided by MMC to the Bangor Daily News, President and CEO Richard Petersen said the hospital faces a $15 million gap by the end of the 2013 fiscal year, which runs from Oct. 1 to Sept. 30, in the wake of a rising number of patients who can’t pay their medical bills.
The hospital is reviewing all of its expenses and plans to introduce incentives for voluntary early retirement to employees next week, he wrote in the memo.
“We have to talk about labor — 60 percent of our expense base is in compensation and benefits — while recognizing that it rightly makes people nervous about their futures,” Petersen wrote. “Please understand that layoffs are a last resort and we’re doing all we can to minimize reductions in our workforce.”
Petersen highlighted several challenges facing hospitals nationally and in Maine, including shrinking reimbursements, “changing regulations, tighter competition and narrowing margins.”
The buyout offer follows news in early May that MMC had declared a hiring and travel freeze in an attempt to plug a $13.4 million hole in the hospital’s operating budget. MMC attributed those losses to declining patient volumes, an increase in the number of patients who need free care, declining payments from Medicare and MaineCare, and a glitch in the launch of the hospital’s electronic health records system.
In the buyout memo, Petersen also touched on $67 million in MaineCare payments owed to MMC that the state recently agreed to repay, as well as a $40 million renovation project that includes the addition of five new operating rooms.
While the hospital is “glad to be reimbursed what we’re owed for services rendered,” the MaineCare repayment “is not a windfall for Maine Medical Center,” he wrote. “The funds will be used to strengthen our financial base.”
The renovation project is needed to update aging operating rooms that leave medical teams cramped as they work on complex procedures, particularly cardiac operations, Petersen wrote.
“I believe that we will get through these challenging times together and will be a stronger organization for our efforts,” he wrote.
Anthem insurance plan with MaineHealth under review
Posted June 28, 2013, at 5:19 p.m.
GARDINER, Maine — A proposed deal between two heavy hitters in Maine’s health care market to offer insurance next year is raising concerns that patients may have to travel further for care and to find new doctors. The deal could affect tens of thousands of residents and greatly shape the rollout of President Barack Obama’s health reform law in Maine.
MaineHealth, the parent organization of Maine Medical Center in Portland, and health insurer Anthem Blue Cross and Blue Shield plan to offer a new insurance product on Maine’s health insurance exchange, an online market where consumers and small businesses can shop for coverage beginning in October 2013. The plans would take effect in January 2014. The exchanges are a key component of the reform law, which aims to widen coverage to 30 million people.
A Friday public hearing hosted by the Maine Bureau of Insurance addressed the network of hospitals and doctors that would provide care to customers who buy the Anthem-MaineHealth plans, which would be available to individuals who buy their own insurance, small businesses and the uninsured.
Workers who have health insurance through a large employer aren’t eligible to shop for plans on the exchange and wouldn’t be affected by the Anthem-MaineHealth deal.
The plans include 32 of Maine’s 38 hospitals, but exclude Central Maine Healthcare, which operates Central Maine Medical Center in Lewiston, Bridgton Hospital and Rumford Hospital, as well as Parkview Adventist Medical Center in Brunswick, York Hospital, and Portland’s Mercy Hospital.
Central Maine Healthcare officials have denounced the plan as a “backroom deal” that allows MaineHealth to undercut hospitals that compete with its health system, undermining the intent of the reform law to improve access to affordable health care. Central Maine Healthcare filed a lawsuit earlier this month to make Anthem’s application public before the insurance bureau decides whether to approve the plan. It also launched a website dedicated to defeating the deal, stopanthemsbackroomdeal.com.
Brenda Weeks, 54, of Auburn, has held an individual Anthem policy for 29 years. She’s worked hard to assemble a team of CMMC medical providers who treat her for multiple sclerosis, and now fears losing them, she said.
Weeks, who uses a wheelchair and relies on a ventilator to breathe, said she’s overwhelmed by the prospect of having to find new doctors and a different hospital, as well as a new health plan with unknown costs and coverage.
“I’ve been very loyal to them, “ she said of Anthem, which also insured Weeks through her parents when she was young. “I don’t like the idea that they are going to turn my world upside down, and that’s what will happen if I have to make these changes.”
Chuck Gill, a spokesman for Central Maine Healthcare, said Friday’s hearing has led to further confusion about which doctors are included in the network, after discrepancies in Anthem’s list were discovered.
Anthem defends network plan to state regulators
Yesterday at 11:14 PM
Proposal that excludes some hospitals has come under fire from doctors and patients.
By Jessica Hall jhall@pressherald.com
Staff Writer
Staff Writer
GARDINER — Anthem Blue Cross and Blue Shield said Friday that its proposed health insurance network with MaineHealth would provide adequate numbers of hospitals and health care providers for Mainers who seek coverage through the insurance exchange to be created by the Affordable Care Act.
In a hearing held by the state's Bureau of Insurance, Anthem said its proposed network, including 32 of Maine's 38 hospitals, would allow every subscriber to reach a primary care physician within 30 minutes and a specialist within an hour's driving time.
The company said it does not know how many Mainers would join the network.
The proposed network has come under fire, with some doctors upset that they would be excluded and some patients fearful that they would no longer be able to go to the doctors and hospitals they now use.
| Maine Hospitals Excluded from Anthem Plan Cry Foul at Public Hearing | |||||||||
| 06/28/2013 Reported By: Patty B. Wight | |||||||||
Maine Medical Center's parent company, MaineHealth, has partnered with Anthem to offer a new online insurance product as part of the Affordable Care Act. The plan was under scrutiny at a public hearing at the Bureau of Insurance today, because it excludes six hospitals. Officials from those excluded hospitals are crying foul, saying if the proposal is approved, it will force thousands of patients to switch doctors. Patty Wight has more.
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http://www.mpbn.net/Home/tabid/36/ctl/ViewItem/mid/5347/ItemId/28727/Default.aspx We need much more than Medicaid expansion
By Andrew D. Coates, M.D., F.A.C.P.
WAMC Northeast Public Radio, June 28, 2013 It is common for people to assume that President Obama’s Affordable Care Act will lead to universal coverage; after all, that was its stated aim. Coverage under the plan, which will not be fully implemented for seven more years, would be driven by a law making private health insurance compulsory, with an individual mandate to purchase health insurance or else pay a fine, for all but the poor, much like the reform led by Gov. Romney in Massachusetts. For the poor, the goal was to expanding Medicaid eligibility to everyone with an income below 138 percent of the federal poverty level. But the Supreme Court, when it upheld the law as constitutional overall, also ruled that states could opt out of the Medicaid expansion. We now know that a significant number state governments will opt out, in the end perhaps more than twenty in all. Texas, Florida, Kansas, Alabama, Louisiana, Mississippi, Georgia and Wisconsin are among the states that have decided not to expand Medicaid to all of the poor. Some commentators and journalists have laid the blame at the feet the Supreme Court for the fact that the president’s “health care overhaul” will fall far short of universal health coverage for our nation. They cite projections that the reform was designed to enroll 16 million of today’s 50 million uninsured people in Medicaid programs. The point is that that many millions will not become eligible as long as their state governments opt out of expanding Medicaid. But being eligible for Medicaid is different from enrolling. In a study published this month on the Health Affairs blog, researchers Rachel Nardin, Leah Zallman and others estimated the impact of Medicaid expansion on the uninsured. They took into account the fact that people have to enroll in Medicaid by basing their estimates upon published take-up rates for public programs, prior publications, and Congressional Budget Office estimates regarding implementation of the president’s health care plan. They found that the president’s plan, overall, “will minimally alter the demographic composition of the uninsured, regardless of whether undecided states opt-in or out. While Blacks and Hispanics will continue to be overrepresented among the uninsured, the majority will be non-Hispanic, white, low-income, working-age adults, many of them employed. The majority (around 80 percent) of the uninsured will be U.S. citizens, irrespective of states’ acceptance of Medicaid expansion. More than 4.3 million children and nearly 1.0 million veterans will remain uninsured under either scenario.” The study also looked at the state governments presently undecided about whether to opt in or out of Medicaid expansion. The researchers found “if all currently undecided states opt-in, 29.8 million people will remain uninsured, whereas if all opt-out, the number of uninsured will total 31.0 million, 1.2 million above the opt-in scenario.” http://www.pnhp.org/print/news/2013/june/we-need-much-more-than-medicaid-expansion | |||||||||
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