RepairPal Is the Only Way to Go

Recently, I was in the beautiful Southern California city of San Diego. I had driven up from Lubbock, TX which is about a 24 hour drive on most occasions. Well, this occasion was a little bit different from any other time I've made the drive. It turns out that my car needed not just one, but three separate repairs. I had remembered a website that I had seen online called http://repairpal.com/san-diego-auto-repair.

So I drove to the nearest Starbucks in order to see if www.repairpal.com could help with my situation. It turns out, Repairpal lists several different companies with different estimates for the particular repair you need. This not only saved me from having to contact these businesses myself and wasting a lot of precious time, but also referred to me the highest quality auto repair shops. There are also encyclopedias (http://repairpal.com/check-engine-light) and a place to actually look at cars for sale (http://repairpal.com/ford-f-150-1999)!

I am NOT a proponent for online shopping (i.e. Car insurance, etc.), however, www.repairpal.com is by far the most time-efficient and convenient way of getting your car or truck repaired. I could not be more satisfied! Well, done www.repairpal.com. Your services will be used for many other occasions.

Check out RepairPal.com and this directory for auto repair and mechanic shops http://repairpal.com/directory.

 

Conclusion: What To Expect

The underlying intent of health care reform was to provide a format in the market place empowering the consumer. The formulators of HCR attempted to push the re-set button on competition when the new law eliminated discriminatory practices toward pre-existing health conditions among other mandates. Combined, they hoped this revised market would reward only the carriers who were able to maximize efficiencies.

A likely unintended consequence could very well be a less competitive market. A rash of mergers and acquisitions may be looming over the next three years prior to the January 1, 2014 date, on which almost all of the mandates must be in place.

Some experts see another unintended consequence of fast rising prices for health insurance prior to January 1, 2014, when regulations govern premiums. The health insurance industry will surely push for some modifications such as increasing the “penalty for not enrolling”, or seeking limited enrollment periods.

Employers in the 50+ employees range may begin to lay off employees to fall below that threshold and avoid the burdens HCR is mandating. They may instead opt for longer hours rather than increasing staff to more than 50 employees.

In its present state, the totality of the mandates in HCR look to be moving the health insurance industry toward the same operating environment as public utilities. If the trend plays out, certain geographic areas may, in fact, see reduced competition. Small regional carriers would be the most likely for acquisition by the large multi-state carriers.

Research has shown that when the profit motive is removed, operating efficiencies of organizations diminish. Many fear the profit motive is being stripped from the health industry. Research and development of new technologies that diagnose and treat health problems could suffer.

You will hear many say US citizens have shorter life expectancies than other nations throughout the world and that is because the US does not have a comprehensive national policy on providing health care to all. The opponents say the life expectancy issue is more a function of life-style choices such as a poor diet and personal hygiene practices.

The debate will continue to be vociferous and heated for the years to come. As the Secretary of Health and Human Services, Kathleen Sebelius, issues rules and regulations, we will begin to see the direction HCR is taking, whether it will in deed become the biggest social program in American history or a catalyst to improve efficiencies and therefore reduce health care costs.

One certainty is known now. The 2700+ pages of HCR law will be challenged Constitutionally. The rules and regs that come out of HHS will be challenged in court and public opinion. New rules and regs will be issued to clarify previous determinations.

How we shop for insurance will change: Consumer Owned and Oriented Plans (COOPs), Exchanges, subsidies, private purchase, small group, large group and individual plans. The category in which you find yourself on January 1, 2014, will generally determine where and how you shop for insurance. For example, those who qualify for a subsidy may be required to buy through the Exchange in order to receive the subsidy.

Health plans with limited benefits will be forced to comply with mandates or cease marketing those products.

The minutiae are so vast and complex, and some people might come to see the system invasive of privacy. When you receive your W-2 statement, you will notice the value of your health insurance on it. If it is too rich, you will have some tax consequences. If nothing is listed, you will be fined. The IRS will be in charge of this monitoring process.

Picture this…..January 1, 2014, arrives. You’re a family with 2 dependent children. You recently had to sell your lake house last year to keep your health insurance from lapsing.

Your neighbor down the street decided to let the insurance company repossess its health insurance policy so he could hang onto his mountain retreat. He has offered you to feel free to enjoy his getaway anytime you need, but you feel bad because you can not reciprocate by allowing him and his family to enjoy the peace and relaxation your health insurance can offer, although you have offered to share with him a reading of the policy.

Then one crisp winter evening following days of white-out blizzard conditions, an avalanche fells the cabin with the two families trapped inside.

True/False:

Will your friend be able to buy health insurance on the way to the hospital?

False?...Then we all should be able to enjoy the health insurance reforms as providing a much welcomed relief to long lingering problems of skyrocketing premiums, exclusion of health conditions, and so on.

True?...Then a nightmarish scenario begins. You beat yourself senseless now having realized you did not need to spend all that money on health insurance. You could have kept your lake home after all. Yes, the premiums are high, but your neighbor only needed to pay the premiums only when he needed the insurance.

As far fetched as this story may seem, it is plausible. Unless, HHS issues parameters on mandatory enrollment, this is exactly what could happen. You will only need to buy the insurance when you need it. AND, it appears, the ambulance ride would also be covered.

Try this…

True/False:

You and your spouse hold separate jobs with large employers (groups over 50 employees). Both provide insurance. Will your employer be required to provide proof of your income to your spouse’s employer, and likewise with her employer?

True. This goes to the reporting requirements of HCR and the “Cadillac Tax,” and the eligibility requirements for subsidies.

Here are some more tidbits of information on how your taxes will be affected. The law is not supposed to tax those making less than $200,000 (single) or $250,000 (household).

-If you make over that income threshold your Medicare tax will increase by 30%.

-If you are able to itemize medical expense deductions, the 7% of Adjusted Gross Income is increased to 10%.

-Employers who are eligible for the Medicare Part D tax credit will lose that credit.

-Funds in Health Savings Accounts can no longer be used to purchase over-the-counter medications.

-The early withdrawal of HSA funds or Archer MSA funds for non-medical reasons will see a 100% increase in the penalty.

-Contributions to Flexible Spending Accounts will be restricted to $2500. That means more income will be subject to taxation.

-Unless you qualify for subsidies from the federal government, you will of course have to pay a penalty for not enrolling in health insurance.

As time goes by, the picture will clear up considerably, but at present many individuals and employers are just waiting to see what will happen. Perhaps the legal challenges will expedite the clarity. Maybe HHS will issue rules and regs more favorable to all. At this point, about all we can do is wait and see how it develops.

Be prepared for the future. Visit www.HealthInsuranceForTexas.com

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Fed Begins To Issue Rules and Regulations on Health Insurance

Within the past week, the Department of Health and Human Services Secretary Kathleen Sebelius issued the first of what will be reams of rules and regulations governing health insurance.

Even as no less than 23 states sue the federal government over the Constitutionality of the Affordable Care Act, many more rules and regulations will be issued in the weeks and months ahead.

The latest issue simply re-states the application of provisions in the law.

-Health insurance policies can not be rescinded by insurance companies after September 23, 2010, for any reason but for the more egregious acts of fraud.

-Health insurance policies can not have lifetime maximum benefits after September 23, 2010.

-Children under age 19 can not be excluded from coverage due to a pre-existing health condition.

-Dependents are allowed to remain on parents’ coverage until age 26 regardless of marital and student status.

These rules apply to individually purchased plans of insurance as well as group plans. Grandfathered plans are not exempt from these items

As the weeks turn into months and months into years, prevailing thought seems to suggest that the small group health plans (group plans under 50 primary insured lives) and individual plans will become virtually indistinguishable. That is, each plan type will look identical and the only difference will be how the plan premium is billed.

Because small group plans have already operated under stricter regulation such as guaranteed issue, we can develop an idea of the future premiums of individual insurance from the small group market when it began to operate under strict controls.

Contrary to expectations, the premiums did not rise as much as expected. However, the ACA does insert other issues that will undoubtedly impact future premiums. As mentioned previously, the Medical Loss Ratio is likely to have the most significant impact. As you may recall, the MLR is the requirement that insurance companies in the “under 50 market” must hold claims to no less than 80% of premiums paid. This can result in premium rebates or potentially large increases.

A second factor that will place upward pressure on premiums is the guarantee issue. Small group plans are guaranteed issue and pre-existing conditions are covered from day one as long as the individual has maintained ongoing coverage for the past 12 months. Otherwise, pre-existing conditions are subject to a waiting period.

ACA does not contain any language related to waiting periods for pre-existing health conditions in the small group market or individual market. HHS is expected to address this concern before January 1, 2014. Insurance companies see this oversight as a big concern, especially since the law will require guarantee issue with no serious mandate for individuals to enroll in insurance other than a “modest” penalty.

Another factor likely to exert pressure on individual plans is the new age rating schedule as set forth by ACA. The premium for the older adults can not be more than four times the rate for the youngest adult. The age rating schedule varies from one insurance company to another, but on average, the current range is about six to one.

Because insurance companies are not likely to lower the premiums for older adults, young adults should expect significant increases in premiums as insurance companies try to close that gap by January 1, 2014.

At that time every individual will be required to buy health insurance or face a penalty. The penalty will be $695 per person per year, up to a maximum of three per family ($2085 total), or 2.5% of household income by 2016. From January 1, 2014, the penalty is $95 (X 3 per family) and in 2015, $325 (3 X per family).

Individuals who object to health insurance for religious reasons are exempt from the penalty as are prisoners, American Indians, undocumented aliens, or others who suffer financial hardship.

The fed will assist in premium payments if household income is between 133% and 400% of federal poverty level (FPL). The amount of the subsidy will vary based on the level of household income in the FPL range. The very bottom could get a 100% subsidy. Additionally the fed will also help pay the out of pocket expenses that arise such as assistance with copays and coinsurance.

Still other individuals will qualify for expanded eligibility under Medicaid.

Because of the laxity of penalties for non-enrollment, some experts believe HHS will have to issue revised regulations restricting enrollment in individual health insurance to prevent people from foregoing enrollment until they become sick. These regulations could look similar to the current Medicare enrollment periods. That is, open enrollment would be restricted to a specific time of year. Failure to enroll during this time would result in the penalty being applied.

Perhaps one of the most troubling aspects of health care reform is what could happen to Medicare beneficiaries.

Health care reform did not change the benefits or delivery method of Medicare Parts A, B, C, and D. It did never the less include some language that implies Medicare Part C beneficiaries may suffer the most.

Part C is also known as Medicare Advantage coverage. Medicare beneficiaries enrolled in Medicare Advantage with or without Part D (prescription drug coverage), have paid little to no premium other than their Part B premium. This almost certainly will change.

Insurance companies that offer Medicare Advantage receive subsidies from Medicare and in return are responsible for all claim payments. Medicare no longer is responsible for claim payments for beneficiaries enrolled in a Medicare Advantage plan.

Over the next 10 years, $50 billion will be extracted from Medicare Advantage subsidies to help finance the rest of the health care reforms, namely the subsidies passed to low income households and the expansion of Medicaid.

Most, if not all, of the $500 billion have to be replaced. The only available source is higher premiums. This could result in a doubling to tripling of current premium levels. Those who pay nothing for their Medicare Advantage could easily see premiums of $150 or much more.

Medicare Advantage plans will probably begin to align themselves with provider networks if they do not do so presently. Some carriers may even discontinue offering Medicare Advantage plans altogether.

If a carrier drops its Medicare Advantage offering, its beneficiaries will be eligible for a special open enrollment in another Medicare Advantage, a Part D (prescription) plan, or a Medicare supplement plan. Medicare A and B look to be completely free of health care reform.

It is becoming clear many more questions arise as we begin to get answers to other questions. Then again, if the states prevail in their lawsuit over the Constitutionality of the new social program, “Will health care reform then be completely abandoned?”

No one likes insurance companies reserving the right to arbitrarily deny coverage. Insurance companies have agreed to reasonable guaranteed issue requirements, provided a few safe guards are in place to protect the viability of reasonable premiums, such as restricted open enrollment periods and heftier penalties for non-enrollment.

Next time: A recap of articles 1-4.