by Admin. | May 19, 2016 | group health insurance, Health Exchanges, Individual Exchanges, individual health insurance, NY News, PPACA, Small Business Group Health
NYS 2017 Rate Requests
The State released NYS 2017 Rate Requests with average increases of 17.3% individual market and 12% for small groups. This early 5/12/16 deadline request requirement is not an Obamacare requirement. As per NY State Law carriers are required to send out notices of rate increase filings to groups and subscribers. ![NYS of Health 2017 Rates request](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2016/05/Screen-Shot-2016-05-18-at-12.56.45-PM-292x300.png)
With only 3 months of mature claims in 2016 to work of off Insurance Actuaries have little experience to predict accurate projections. Typically the rate requests must be high and in the past final approvals after negotiations were only half, see https://medicalsolutionscorp.com/nys-2016-rates-approved/. The national rate trend, however, has been much higher than in past years due to higher health care costs and the loss of Federal reinsurance fund known as risk reinsurance corridor.
This is one of the reasons why the individual market is significantly more costly to operate than small group as per recent United Healthcare pull out of most State Individual Exchanges, UnitedHealthcare will drop ACA Exchanges. In fact, the Health Republic NY is Shutting Down highlights how an insurer banked on the federal risk corridor reinsurance and underestimated NYS costs of care. Another local example is Oscar Health Insurance which has lost $105 million and is asking for up to 30% rate increase. The 3 year old company said the increase was necessary because medical costs have risen, government programs that helped cover costs are ending, and its members needed more care than expected. That all translates into the need for a price correction.
Importantly, the individual market subsides may be on borrowed time. Last week, The Federal Court ruled that Obamacare subsidies were illegally funded. The ruling while the Obama administration challenges it in D.C. Circuit Court of Appeals, is still allowing the reimbursements to continue for now. The practice of some small businesses dropping group health insuarnce in favor of the Individual Plans known as “cash for insurance” is put into question by this. While the IRS ruled that this is prohibited (see below) some small business are attracted to the simplicity of a public exchange and not getting involved in the managing of plans. Prohibited: The IRS prohibits employers from giving (or reimbursing) employees pre-tax funds to buy health insurance on their own—through the state-based and federally facilitated exchanges or private marketplaces alike.1 This practice may result in a $100 per day excise tax per applicable employee, according to an IRS Q&A released in May 2014.2
Instead, the correct approach for a small business in keeping with simplicity is a Private Exchange. This is a true defined contribution empowering employees with choice of leading insurers offering paperless technologies integrating HRIS/Benefits/Payroll. Both employee and employers still gain tax advantage benefits under the business. Also, the benefits, rates and network size are superior under a group plan as THE RISK OUTLINED ABOVE ARE HIGHER FOR INDIVIDUAL MARKETS THAN SMALL GROUP PLANS.
For more information on how a Private Exchange can help your group please Contact us at (855)667-4621.
Summary of 2017 Requested Rate Actions
INDIVIDUAL MARKET
Company Name |
2017 Requested Rate Change |
Aetna Life Insurance Company |
19.4% |
Affinity Health Plan, Inc.* |
20.7% |
Capital District Physicians’ Health Plan* |
11.2% |
Crystal Run Health Plan, LLC* |
89.1% |
Empire HealthChoice HMO, Inc.* |
24.0% |
Excellus Health Plan, Inc.* |
15.9% |
Health Insurance Plan of Greater New York* |
14.0% |
Healthfirst PHSP, Inc.* |
6.6% |
HealthNow New York Inc.* |
6.1% |
Independent Health Benefits Corporation* |
19.2% |
MetroPlus Health Plan, Inc.* |
20.3% |
MVP Health Plan, Inc.* |
6.1% |
New York State Catholic Health Plan, Inc. dba Fidelis Care New York* |
8.1% |
North Shore-LIJ CareConnect Insurance Company, Inc.* |
29.2% |
Oscar Insurance Corporation* |
18.4% |
UnitedHealthcare of New York, Inc.* |
45.6% |
Weighted Average Requested Rate Change – Individual Market |
17.3% |
*Indicates that the company makes products available on the “New York State of Health” marketplace.
SMALL GROUP MARKET
Company Name |
2017 Requested Rate Change |
Aetna Life Insurance Company |
12.0% |
Capital District Physicians’ Health Plan, Inc. |
9.6% |
CDPHP, Universal Benefits Inc.* |
11.6% |
Crystal Run Health Insurance Company, Inc. |
61.9% |
Crystal Run Health Plan, LLC |
66.6% |
Empire Healthchoice Assur Inc |
10.0% |
Empire HealthChoice HMO, Inc. |
12.6% |
Excellus Health Plan, Inc.* |
12.3% |
Health Insurance Plan of Greater New York* |
10.6% |
Healthfirst Health Plan (Managed Health) |
5.0% |
HealthNow New York Inc.* |
5.8% |
Independent Health Benefits Corporation* |
11.2% |
MetroPlus Health Plan, Inc.* |
13.1% |
MVP Health Plan, Inc.* |
5.4% |
MVP Health Services Corp. |
6.8% |
North Shore-LIJ CareConnect Insurance Company, Inc.* |
16.8% |
Oxford Health Insurance, Inc.* |
12.9% |
UnitedHealthcare Insurance Company of New York |
12.8% |
Weighted Average Requested Rate Change – Small Group Market |
12.0% |
*Indicates that the company makes products available on the “New York State of Health” marketplace.
Source: https://myportal.dfs.ny.gov/web/prior-approval/summary-of-2017-requested-rate-actions
Resource:
by Admin. | May 3, 2016 | healthcare, HSA
HSA 2017 Limits
The IRS has released the 2017 Health Savings Account (HSA) inflation adjustments. To be eligible to make HSA contributions, an individual must be covered under a high deductible health plan (HDHP) and meet certain other eligibility requirements.
New HSA 2016 limits are as follows: ![HSA 2016 Limits HSA 2016 Limits Chart](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2010/11/hsa-work.gif)
HSA Annual Contribution Limit:
Single – $3,400 ($3,350 in 2016)
Family – $6,750 ($6,750 in 2016)
Catch-up – $1,000 ($1,000 in 2016) for age 55+.
HDHP Minimum Annual Deductible:
Single – $1,300
Family – $2,600
HDHP Out-of-Pocket Maximum:
Single – $6,550 ($6,550 in 2016)
Family – $13,100 ($13,000 in 2016)
Age 55 Catch Up Contribution-As in 401k and IRA contributions, you are allowed to contribute extra if you are above a certain age. If you are age 55 or older by the end of year, you can contribute additional $1,000 to your HSA. If you are married, and both of you are age 55, each of you can contribute additional $1,000.
HSA/HDHP Market Growth
HSA holders own the assets in the accounts and can build up substantial sums over time. Enrollment in HSA-compatible insurance plans has increased to 10 million earlier this year, from 1 million in March 2005, according to, America’s Health Insurance Plans (AHIP), a trade group.
HSAs were authorized starting in January 2004. Since then, AHIP has conducted a periodic census of health plans participating in the HSA/HDHP market.
- The number of people with HSA/HDHP coverage rose to more than 11.4 in January 2011, up from 10.0 million in January 2010, 8.0 million in January 2009, and 6.1 million in January 2008.
- 30 percent of individuals covered by an HSA plan were in the small group market, 50 percent were in the large-group market, and the remaining 20 percent were in the individual market.
- 14% of all workers in the private sector that have access to a Health Savings Account acc. to Bureau of Labor Statistics.
- States with the highest levels of HSA/HDHP enrollment were California, Ohio, Florida, Texas, Illinois and Minnesota.
HSA Advantages:
- Opportunity to build savings – Unused money stays in your account from year to year and earns tax-free interest. The HSA also gives you an investment opportunity.
- Tax-free contributions and earnings – You don’t pay taxes on contributions or earnings.
- Tax Free Money allowed for non traditional Medical coverage– As per IRS Publication 502, unused moneys can be used for dental,vision, lasik eye surgery, acupuncture, yoga, infertility etc. Popular Examples
- Portability – The funds belong to you, so you keep the funds if you change jobs or retire.
Our overall experience with HSAs have been positive when employer funding is at minimum 50% using either the HSA or an HRA (Health Reimbursement Account-employer keeps unspent money). Traditional plans trend of higher copays and new in network deductibles has also led to the popularity of an HSA.
Is your HSA compliant? Which pre-tax qualified HSA, FSA, HRA spending card is right for you? Please contact our team at Millennium Medical Solutions Corp (855)667-4621 for immediate answers. Stay tuned for updates as more information gets released. Sign up for latest news updates.
RESOURCE:
by Admin. | Apr 20, 2016 | healthcare, Individual Exchanges, individual health insurance, latest health insurance news, Obamacare, State Exchanges, United Healthcare
UnitedHealthcare will drop ACA exchanges
![UnitedHealthcare will drop ACA exchanges](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2016/04/UnitedHelatcare-Individual-by-State.jpg)
UnitedHealthcare Individual by State
BREAKING:
So far, New York and Nevada have confirmed that UnitedHealth plans to remain on their ACA exchanges next year. The company has also filed plans to participate in Virginia for 2017. Wisconsin said it hasn’t received an exit notice from UnitedHealth, and that it doesn’t comment on insurers’ business plans. A representative of Covered California, the state’s Obamacare exchange, said plan participation is confidential until it’s announced later this year.
UnitedHealthcare will drop out of most ACA Exchanges by 2017 as reported in Modern Healthcare. Just how significant is this to the market? Realistically, United took a cautious wait and see approach. In NYS, for example, they have been the most expensive plan on the Obamacare Exchange Marketplace. They expect to lose over a billion dollars in this space for 2015 and 2016, so to them it makes no sense to stay in that market. The concern for the individual market is to expect large pricing increases in 2017 to reflect the higher risk than the safer Group Market.
UnitedHealth, which had about 795,000 ACA customers as of March 31, warned in November that it was posting losses on ACA policies. In December, the company said it should have stayed out of the individual exchange market longer. UnitedHealth also is withdrawing from some related state insurance markets for small businesses.
See United-healthcare Individual members enrolled by State: ![UnitedHelatcare Individual by State](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2016/04/UnitedHelatcare-Individual-by-State.tiff)
UnitedHealthcare will drop ACA exchanges
MODERN HEALTHCARE
By Bob Herman
April 19, 2016
UnitedHealth Group CEO Stephen Hemsley said Tuesday the health insurance and services conglomerate will pull out of most of its Affordable Care Act marketplaces. But the company won’t bail on the exchanges completely and will sell individual plans in a “handful” of states.
“We cannot broadly serve it on an effective and sustained basis,” Hemsley told analysts and investors on a conference call. UnitedHealth has fully or partially exited five states so far—Arkansas, Georgia, Louisiana, Michigan and Oklahoma, according to various news reports.
The company sold plans in 34 states for this policy year and did not disclose which states it will stay in. Insurers that sell plans through the federal HealthCare.gov portal have until May 11 to file rates for 2017 plans.
A new analysis from the Kaiser Family Foundation, however, notes that UnitedHealth’s exits would only have a modest effect on competition and prices nationally since it has a small ACA footprint and charged higher premiums from the outset.
UnitedHealth recorded an additional $125 million loss on its individual ACA plans, meaning the company’s total ACA losses for 2015 and 2016 will exceed $1 billion. UnitedHealth signed up many sicker-than-expected members, ending the first quarter with 795,000 public exchange enrollees, which is only a fraction of the ACA’s individual market.
The insurer also overpriced its plans in 2015 after barely participating on the exchanges in 2014. UnitedHealth expects its exchange membership will decline to 650,000 by the end of the year.
But despite those heavy losses, which UnitedHealth previewed late last year, the company’s other lines of business like Medicare Advantage and Optum have been making money at a healthy clip. UnitedHealth’s profit climbed 14% year over year, totaling $1.6 billion in the first three months of this year. Adjusted earnings per share rose 17% to $1.81, beating estimates on Wall Street.
Revenue soared almost 25% to $44.5 billion in the first quarter, putting UnitedHealth on pace to hit $182 billion of revenue for the year. The Minnetonka, Minn.-based company recorded double-digit revenue growth across every major segment, including employer, Medicaid, Medicare Advantage and its Optum health services business. UnitedHealth now covers the medical care of nearly 47.7 million Americans.
UnitedHealth’s medical-loss ratio, which shows how much of its premium dollars were spent on medical care or “quality improvement” programs, was 81.7% in the quarter. That was up slightly from the 81.4% posted in the same quarter last year, which UnitedHealth attributed to the leap day.
by Admin. | Mar 7, 2016 | healthcare, individual health insurance, Pharmaceutical Industry
Brand Name Drugs Are a Waste of Money?
Generics or Brands? This is not a new question and has been discussed. Our blog post “Generic Drugs vs. Brand Name – Are there any differences?” was covered in 2009. But since last decade most brand drug’s patents have fallen of a cliff. See popular Rx expirations below and infographic of “Major Drugs Going Off-patent in 2016.”![Brands losing patent 2016](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2016/03/drug-patents-2016-371x1024.png)
- Lipitor
- Seroquel
- Crestor
- Prevacid
- Nexium
- Zyprexa,
- Plavix
- Singulair
- Lexapro
- Enbrel
According to Vox article “Stop wasting money on brand-name drugs “On average, generics cost 80 to 85 percent less than name-brand medicines, according to the Food and Drug Administration (FDA). And buying unbranded drugs isn’t like opting for cheap toilet paper or no-name face cream: Less expensive here doesn’t necessarily mean lower quality.”
Many people have heard that switching to a generic medication will save them money. One of the questions we hear most often is, “How do generic medications compare to their brand name counterparts?” Knowing the facts about generics versus brand names can help make us all better consumers.
What’s the difference between generic and brand-name drugs?
Generic medicines are chemically equivalent to the original brand-name drugs and work just as well for nearly all patients. Many people are concerned that because generic drugs are often much cheaper than the brand-name versions, the quality and effectiveness have been compromised to make a less expensive product. The FDA requires that generic drugs be as safe and effective as the original brand name drugs. Generic drugs are copies of brand name drugs that have exactly the same dosage, intended use, effects, side effects, route
of administration, risks, safety, and strength as the original drug. In other words, the pharmacological effects of generic medications are exactly the same as those of their brand name counterparts. It is important, however, to check with a Physician and have a conversation about alternatives since generic drugs may contain slightly different INACTIVE ingredients. These are things like binding materials, dyes, preservatives, and flavors.”
Another common myth is that generic drugs take longer to work. The FDA requires that generic drugs work as fast and as effectively as the original brand name products.
When a drug loses patent protection, often only one generic version is on sale for the first six months, so the price falls a little bit initially. Then, several other generic makers typically jump in, driving prices down dramatically.
What are the actual costs differences?
Last year, the average generic prescription cost $72, versus $198 for the average brand-name drug, according to consulting firm Wolters Kluwer Pharma Solutions. Those figures average all prescriptions, from short-term to 90-day ones.
Average copayments last year were $6 for generics, compared with $24 for brand-name drugs given preferred status by an insurer and $35 for non-preferred brands, according to IMS Health. Protonix, for severe heartburn, now costs just $16 a month for the generic, versus about $170 for the brand name. And of the top sellers that soon will have competition, Lipitor retails for about $150 a month, Plavix costs almost $200 a month and blood pressure drug Diovan costs about $125 a month. For those with drug coverage, their out-of-pocket costs for each of those drugs could drop below $10 a month.
All patients are encouraged to discuss generic alternatives with their physicians prior to filling a prescription. The doctor and the patient should agree on the best course of treatment for any diagnosed medical condition.
Resource:
Discount Rx Card: www.bonusbenefit.com
Pharmacy and Rx Costs Look Up: http://www.rxpricequotes.com
by Admin. | Dec 22, 2015 | Health Care Reform, Obamacare, Tax
Breaking: Cadillac Tax Delayed
![Obamacare tax delayed](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2015/12/151217164541-obama-healthcare-cadillac-tax-780x439-300x169.jpg)
The Cadillac Tax has been delayed for two years from 2018 to 2020 by President Obama. With this delay, a repeal could be in reach for congressional leaders and business groups who oppose the Cadillac tax. The legislation also suspends the medical device tax until December 31, 2017 and delays the health insurance tax one year.
Whats a Cadillac Tax?
The 40% excise tax applies to the cost of employer health plan coverage exceeding certain threshold amounts, which were originally set for 2018 at $10,200 for individuals or $27,500 for families. These thresholds are indexed and will be higher on the delayed effective date in 2020. The Omnibus also calls for a study on how to determine adjustments to these thresholds to reflect age and gender differences between businesses. While the tax was originally non-tax deductible, the Omnibus changes that treatment and makes the tax deductible. Originally, the Cadillac Tax was pushed back by the behest of Unions to 2018 from the original proposed 2014 date. Most Unions with generous health care packages would not be complaint within that time frame.
Bipartisanship
The bipartisan vote on the Consolidated Appropriations Act was 316 to 113 in the House, and 65 – 33 in the Senate. Many employers, unions, insurers and industry groups have opposed the tax based on concerns around administrative and financial burdens for employers and adverse outcomes for employees.
Medical Device Tax
The tax bill will place a two-year moratorium on the ACA’s 2.3% tax on the sale of medical devices. The tax imposed under this provision will not apply to sales during the period beginning on January 1, 2016, and ending on December 31, 2017. This applies to sales after December 31, 2015.
Health Insurance Industry Tax
The tax bill places a one-year moratorium on the so-called HIT tax (Health Insurance Industry Tax). If passed, the industry tax will not apply for calendar year 2017, which should result in less of an increase to group health insurance premiums for 2017.
So who said Washington bipartisanship was over? There is hope going into the New Years.
Happy 2016!
![Merry-Xmas-and-Happy-New-Year-2016-HD-Dektop-Wallpaper-1366x768](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2015/12/Merry-Xmas-and-Happy-New-Year-2016-HD-Dektop-Wallpaper-1366x768-300x169.jpg)
by Admin. | Dec 10, 2015 | NY News, Obamacare, Small Business Group Health
![HRNY ending 2016](https://5zs2d3.p3cdn1.secureserver.net/wp-content/uploads/2015/09/Health-Republic-Shutting-Down-300x157.jpeg)
Aftermath of Health Republic Shut Down
The article below summarizes in full the Aftermath of Health Republic Shut Down. The original NYS announcement to shut down Nov 30th was released on Friday October 30th. There are countless anecdotal evidence of our client’s Providers not getting paid for work already done this Fall. Brokers , our Agency included, has NOT been paid since this Summer.
Should My Doctor and Broker be paid? That really ought to be the header for this article. At the same time Health Providers and Brokers honored clients despite the Health Republic’s precarious financial status. The approximate amount owed is $150 Million. If the State truly wants to correct this they have a $1Billion surplus. How can the State obligate Providers and Brokers to meet contractual licensing & professional standards and ignore them now?
As reported in Mahopac NY News 12/9/15 by BRETT FREEMAN
Doctors, Insurance Brokers Could Lose Millions After Health Republic’s Collapse
HUDSON VALLEY, N.Y. – When Health Republic Insurance of New York announced early last month that they were ceasing operations at the end of November, individual subscribers and small groups had to scramble for other options to keep themselves and their employees insured.
Doctors and individual insurance brokers weren’t so lucky.
Often overlooked in news reports is how Health Republic’s demise affected thousands of medical providers and individual insurance brokers, who may never see a dime from all that is owed to them.
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Health Republic was a not-for-profit health insurance co-op (Consumer Operated and Oriented Plan) established under the Affordable Care Act. According to its website, at its height, it had over 215,000 members, making it the largest new health insurance cooperative in the country.
According to articles linked on Health Republic’s website, it borrowed a $265 million low-interest federal loan to begin its operations and was one of 23 co-ops receiving a total of $2.4 billion. According to reports, about half of them have since failed, with many analyses pointing to the low premiums as the cause of their collapse.
Dr. Scott D. Hayworth, president and CEO of the Mount Kisco Medical Group (MKMG), estimates that his practice, which provides medical care to 500,000 patients in the Hudson Valley (including thousands of patients in Mahopac, Somers, Yorktown and North Salem), has lost millions of dollars due to the collapse of Health Republic.
“It’s more than just the doctors’ fees,” said Hayworth, who oversees 450 physicians in dozens of locations throughout the Hudson Valley. Dr. Hayworth said that insurance reimbursements cover vaccines, chemotherapy and other ambulatory and pharmaceutical products that were paid for out of pocket by MKMG.
Despite its losses, MKMG continued to honor its contract with the insurance carrier to ensure any patients covered by Health Republic would continue to receive medical care.
“The thing we all have to remember is there is a patient in the middle of this,” Hayworth said. “Our first obligation is to our patients.”
Other health care providers, including local hospitals, have been in the same boat as MKMG.
Putnam Hospital Center is owed $1.8 million, according to Marcela Rojas, the manager of public and community affairs. Health Quest, which is the parent company of Putnam Hospital Center, is owed $4.4 million in total and doctors throughout its three hospitals are owed $350,000.
“In meetings with state officials, a discussion has focused on how to recoup any of these payments owed to individual patients as well as hospitals, physicians and other providers,” Rojas said in an email interview this past Friday. “There is a discussion on restructuring Health Republic, but the question is, what assets, if any, remain? Recouping any funds may be both a federal and state matter. There is currently no guarantee, emergency or recovery fund in Washington or Albany to cover those losses. Hospitals are meeting with state legislators this week to discuss how best to proceed to recoup at least some of the money owed.”
Officials at Northern Westchester Hospital estimate that they will be owed $2 million due to nonpayment of services provided to Health Republic patients.
“We believe NWH will recover some unknown portion of that amount,” said Joel Seligman, president and CEO of Northern Westchester Hospital. “Under New York State law, NWH must continue to provide services to patients for 60 days where continuity and transitions of care are an issue. Northern Westchester Hospital has a robust financial assistance policy applicable to all patients, including former Health Republic patients.”
All of these healthcare providers are receiving guidance and advocacy from the Healthcare Association of New York State (HANYS), a non-profit statewide association representing hospitals, health systems, nursing homes, home care agencies and other providers across the state.
In an interview, Melissa Mansfield, associate director of public and media relations for HANYS, explained that other states have something called a guarantee fund, which operates as an insurance company for the insurance company.
“New York is one of the few that does not have one yet,” she said, adding that medical providers statewide are owed $160 million, not including what will be owed for care rendered during the month of November.
“HANYS is aggressively advocating on behalf of our members with Cuomo administration officials and CMS (Centers for Medicare & Medicaid Services) to secure payment for money owed by Health Republic,” Mansfield said. “HANYS is exploring all available options for immediate payment and pursuing the establishment of a guarantee fund as a way to protect providers for Health Republic claims and from future insolvencies. Our members are obviously concerned about the impact Health Republic’s shutdown has had on patients and are committed to providing care during this transition. However, HANYS continues to raise very serious concerns about the consequences of such a tremendous financial loss when hospitals are already financially fragile.”
In Putnam County, there were 4,241 Health Republic enrollees, according to HANYS. In Westchester County, there were 20,404 enrollees, making it the third-most impacted county in the state, behind Nassau and Suffolk counties.
In a recent interview, state Sen. Terrence Murphy, who represents Mahopac, Somers, Yorktown and North Salem, among other communities, expressed outrage at the collapse of Health Republic, calling it, “at a minimum, gross mismanagement and negligence. Where the hell was DFS?” Murphy asked, referring to the Department of Financial Services, the state agency that oversees various industries that operate in the state, including all insurance companies. Murphy said DFS should be investigated.
On Sept. 25, DFS directed Health Republic to cease writing new health insurance policies and announced that the co-op would commence an orderly wind down after the expiration of its existing policies. Weeks later, after a review of Health Republic’s finances, finding it in worse financial condition than the company previously reported in its filings, DFS and New York State of Health, which is the official agency administering the Affordable Care Act, ordered Health Republic to end all of its policies on Nov. 30.
A spokesman for DFS did not return a phone call seeking comment, but on its website, officials with DFS said they opened an official investigation last week on Health Republic’s inaccurate financial reporting.
“NYDFS investigators are collecting and reviewing evidence relating to Health Republic’s substantial underreporting to NYDFS of its financial obligations,” according to the statement. “Among other issues, the investigation will examine the causes of the inaccurate representations to NYDFS regarding the company’s financial condition.”
According to DFS, medical providers who contracted with Health Republic had been legally bound to provide healthcare through the expiration of a patient’s plan with Health Republic, regardless of their concerns about reimbursement.
“NYDFS is taking actions that will apply a New York State law that prohibits providers from collecting or attempting to collect from Health Republic consumers amounts that are owed by Health Republic,” a statement on the website said. In addition, according to the DFS website, doctors must honor all new insurance policies of patients who are in an ongoing course of treatment with a provider for a life-threatening or a degenerative and disabling condition or disease, or in the second or third trimester of pregnancy for up to 60 days or through the pregnancy.
All of this is good for the patients, but Murphy expressed worry about how some local doctors might fare with all the lost reimbursements.
“You have practices that might go belly up,” said Murphy, who is a chiropractor in addition to being a legislator. “This is going to be a disaster…You will see some of them go out of business.”
While Dr. Hayworth at MKMG expressed confidence that his medical group would continue to offer top-notch care for its patients, he said that healthcare is a narrow-margin business and lost reimbursements will affect his group’s ability to recruit the best and brightest physicians, who he fears might be lured to other states.
Hayworth, who is married to former Congresswoman Nan Hayworth, declined to comment on the politics of the Affordable Care Act, but he said there definitely needs to be insurance reform. He also called on Albany and Washington, D.C. to provide “legislative relief” to the medical providers impacted by Health Republic’s collapse.
Sen. Murphy, who is chairman of the Administrative Regulations Review Commission, said he respects the legislative process, which calls for other committees to work on the problem, but has shared his concerns with state Sen. Kemp Hannon, chair of the Health Committee, who has started up round table discussions to determine the next steps.
“Anything to make sure this never happens again,” Murphy said.
Assemblyman David Buchwald, who represents North Salem, is also working on the problem.
“I have heard from constituents who are doctors and are concerned that they will not be paid for the services they provided to Health Republic patients,” Buchwald said in statement. “I have worked to raise this issue in Albany while the legislature is not in session. Understandably, the most immediate concern is ensuring that people who had Health Republic insurance are transitioned as smoothly as possible to new insurance. This is important to both patients and doctors, so that at least people are insured and health providers get paid going forward. Next, New York will hopefully see to it that insurance companies have adequate financial resources and address the needs of health professionals who have been left holding the bag. I expect that work to begin as soon as Health Republic customers are transitioned to their new insurance.”
Assemblyman Steve Katz, who represents Mahopac, Somers and Yorktown, did not return a call seeking comment. Nor did Congressman Sean Patrick Maloney, who represents Mahopac, Somers and North Salem in the U.S. House of Representatives, and Congresswoman Nita Lowey, who represents Yorktown.
In addition to the health care providers, local brokers are also out of luck. Mahopac resident Robert Simone, a broker with INS Brokers Inc., said he is owed thousands of dollars from Health Republic for his September and October commissions.
In an attempt to recoup his commissions, he called Health Republic, which told him to call DFS.
“DFS said, ‘We have nothing to do with it. Health Republic is holding your money.” Simone said he is not optimistic.
Nor is Chris Radding, one of the owners of the Forbes Agency in Katonah. Radding said he had 22 employer groups who had been members of Health Republic and he had lost thousands of dollars in commissions when Health Republic folded.
“Anything I’ve seen, there is no mention of the broker,” Radding said. Both Radding and Simone emphasized that their priority was ensuring that their clients had health coverage.
“The whole thing is pretty frustrating and really kind of disgusting,” Radding said.
In a press release issued Monday, the New York State Association of Health Underwriters estimated that insurance brokers in New York State will have lost millions of dollars due to unpaid commissions.
“What’s needed is a solution that avoids the usual outcomes of a failed insurance carrier,” the release said. It listed the usual outcome as reduced payments or no payments to those who provided their professional services even after the carrier ceased reimbursement for those services. It also said the solution should not inflate future insurance premiums or increase New York residents’ tax burden.
“We think that we have such a solution,” the release said. “NYS recently announced the existence of a $1 billion surplus, $680 million of which was generated by penalties levied by DFS. New York State should use some of that surplus to pay everyone what they are owed—doctors, hospitals and insurance brokers—and NYS should also ensure that Health Republic enrollees who have selected a licensed insurance advisor will continue to benefit from their advice by directing succeeding carriers to automatically appoint those brokers when their clients accept an auto-enrollment offer.”