Starting January 1, 2018, New York State will require all ALL PRIVATE EMPLOYERS with one or more employees to obtain insurance under their disability insurance. Designed to provide financial stability for state residents through major life changes, the new policy will provide guaranteed paid leave for families in three life circumstances including:
Care for a covered family member when the family member has a serious health condition;
Bond with his or her child the first year of birth or adoption; or
Spending time with a family member being called to active military service
Plan for Staffing
If you have one or more employees who may use Paid Family Leave in 2018, you need to have the right staff in place to cover their workload while they’re out. There are many ways to make sure you’re covered during an employee’s PFL, but they all start with a plan of action.
Start now by making sure you have cross-training plans in place. And if necessary, consider starting a relationship with a short-term staffing company to see you through the employee’s absence. You’ll also want to create a guide or process for tracking eligibility requirements and requests for PFL, so you can ensure the proper level of benefits and leave time are implemented.
Get Payroll in Order
New York State Paid Family Leave will be financed through employee payroll deductions, so now is the time to start having a conversation with your payroll provider. Whether your payroll is handled in-house or by a third-party payroll processor, this team can help you get ahead of any process changes necessary to prepare for the implementation of PFL on January 1, 2018.
Double-Check Insurance
Have a conversation with your insurance broker or agent to ensure that both of you know what’s coming down the pike and what needs to be done about it. This is also a good time to confirm that your current statutory disability (DBL) carrier will remain in the PFL/DBL market. In addition, you should make sure your company is fully compliant with today’s DBL requirements.
Housekeeping Items
Because there’s a new policy being implemented, now is also a good time to do a quick sweep of housekeeping items you may have put to the side. A few examples include the following:
Locate, organize, and update employee policies
Include PFL guidance in new employee handbooks
Gather PFL forms, such as the Request for Paid Family Leave form (when available)
Make plans to include PFL to your mandatory signage in break rooms or in another prominent location in the building
Prepare for Employee Education
Prepare to educate employees and communicate to them the details and eligibility requirements of the new PFL benefit. Be sure to create written documentation of the new policy, including eligibility requirements, so employees have a reference in-hand when necessary.
Ask Questions
Education is a key component to PFL compliance, so continue to ask questions as they arise. Our Agency’s, HR providers and third-party payroll processors are there to answer your questions. The more knowledge you attain now, the more smoothly the transition to PFL compliance will go.
Next Step Toward PFL Compliance
Educating yourself now can help everyone be better prepared. Although not all of the details have been finalized yet, we hope this checklist helps you achieve an easier transition to PFL compliance when the time comes.
How to Get a Quote for Paid Family Leave Coverage?
If your New York State clients are looking for quality DBL coverage to comply with the new Paid Family Leave policy, MMS Corp. will need policy payroll information to provide an accurate quote. The payroll wage totals must include a cap adjustment for those employees that make over the statewide average weekly wage of $1,305.
For example, if the employee makes over $67,860 (SAWW $1,305 x 52 weeks), the employer must only report the wages up to that amount. The Paid Family Leave rate of 0.126% will be applied to the total adjusted wages provided by the employer to calculate the Paid Family Leave premium amount.
Learn More About the New York State Paid Family Leave Policy
Find out how you can help your New York State clients get prepared for the new Paid Family Leave Policy now by booking a training webinar.
Contact Us Now Learn how our Agency is helping buinsesses thrive in today’s economy. Please contact us at info@medicalsolutionscorp.com or (855)667-4621.
CareConnect today has announced their intent to withdraw from the NYS 2018 market. The ACA Risk Adjustment Program was penalizing CareConnect again $100 Million for 2018 after a $112 million tax in 2017.
The problems CareConnect was facing were not new and was covered in last month blog. This problem has bipartisan recognition and Cuomo Administration Asks Feds for ‘Immediate Changes’ to Risk Adjustment Program. While this tax or “risk adjustment penalty” was intended to increase competition it is blamed as the single largest bankruptcy cause for the 12 of 16 Obamacare Co-Ops such as the Health Republic of NY and for start-ups like Oscar and CareConnect.
The formula used to calculate payments in the risk-adjustment program has been criticized for unfairly favoring larger plans with more claims experience. Smaller companies that sell on the ACA’s exchanges have said they don’t have as many claims data, and therefore their membership base looks healthier than it is. In a twisted way, the young companies in need of help were actually subsidizing mature Insurers with legacy data systems.
Who is CareConnect?
CareConnect is a physician/hospital-owned Insurer by Northwell Health also formerly known as North SHore LIJ. Careconnect manages the health of 400,000 individuals, including 125,000 customers. Outside of the risk adjustment penalty the Insurer was managing population health and would have posted a profit. Their past rate increases were single digits.
Sadly, this is a tremendous consumer market hit. Their growth was predicated on delivering excellence of care while still mindful of consumer affordability, see chart below. Not only were they on average 20-30% less expensive but their benefits were typically enhanced. Example: A Tradition Gold plan member would NOT have a deductible nor coinsurance for surgeries and hospital stays at a time when all competing Gold plans did.
Regrettably, no State appeal has been victorious as of yet. With logger-head federal conflicts in Government today on repairing Obamacare flaws the victims will once again be the middle-class consumer.
NYS has approved 2018 Final Rates last week. Small group rates will increase 9.3% while the individual rate average increase will be 13.9%.
As per NY State Law carriers are required to send out early notices of rate request filings to groups and subscribers see original –NYS 2018 Rate Requests. With only 3 months of mature claims, experience for 2017 health insurers’ requests are historically above average. Ultimately the State reduces this request substantially. This year, however, NYS acknowledged that medical costs increased, citing a 7-percent average increase on the individual market and an 8.5-percent increase on the small group market. The administration also acknowledged drug prices have impacted insurers, pointing specifically to blockbuster drugs for Hepatitis C.
OTHER STATES
The national rate trend, however, has been much higher than in past years due to higher health care costs Like other states throughout the nation, the 2017 rate of increase for individuals in New York is higher than in past years partly due to the termination of the federal reinsurance program. The loss of the program’s a.k.a. federal risk reinsurance corridor funds account for 5.5 percent of the rate increase.
How are neighboring States doing? In NJ, not that bad. According to a review of filings made public last week the expected rate increase will likely be half. Example: Horizon Blue Cross Blue Shield requested a 4.8% increase on their OMINA Plans. For CT market, on the other hand, things are much worse at least for the individual marketplace with average 25% rate increases.
While the individual mandate is still the law, Washington has made it clear that they aren’t going to enforce the mandate. That means fewer people will buy health insurance raising the prices for those who do.
A bipartisan group of congressional representatives has discussed an agreement to extend and guarantee the payments, but it’s unclear whether they could do so by the new filing deadline of Sept. 5. A lawsuit filed by Congress against the Obama administration to challenge the payments is still pending. In addition, Trump has repeatedly threatened to withhold payments to insurers that reduce cost-sharing – deductibles, copays and coinsurance – paid by low-income customers. More than half of New Jersey’s marketplace customers receive that assistance, and without it, most would be unable to afford coverage.
Finally, a tax on health insurance premiums is due to be reinstated in 2018 after a one-year “tax holiday” approved by Congress for 2017. That contributed 2.3 percent to the rate hikes that insurers requested last year.
SMALL GROUP MARKET VS. INDIVIDUAL MARKET
The new premium hikes ranged from as little as .8% percent for Hudson Valley’s Crystal Run Health Insurance Company to a whopping 20.4% percent increase for Albany region’s CDHP. Importantly, small group market is still more advantageous than individual markets unless one gets a sizable low-income tax credit.
Overall, about 350,000 individual plan consumers will be affected by the price hike, while more than a million users will be hit by higher small group fees. Last year, Blue Cross Blue Shield released a study showing Obamacare user costs were 22 percent higher than people with employer-sponsored health plans, while UnitedHealthplans to exit most Exchanges see – Breaking: Oxford Exits Metro Indiv & Oxford Liberty HMO 2017.
The correct approach for a small business in keeping with simplicity is a Private Exchange and with our large buying group PEO partnerships. This is a true defined contribution empowering employees with a 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 are lower for small group plans than individual markets.
* All amounts are rounded to the nearest 1/10.
**Indicates that the company makes products available on the “New York State of Health” marketplace.
Learn how a Private Exchange and our PEO Partnership can help your group please contact us at info@medicalsolutionscorp.com or (855)667-4621.
Cuomo Administration Asks Feds for ‘Immediate Changes’ to Risk Adjustment Program
Yesterday marked 1 the year anniversary since the above Politico article “Cuomo Administration Asks Feds for ‘Immediate Changes’ to Risk Adjustment Program” was published. Little has changed and the controversial ACA Risk Adjustment is proving to be a company killer rather than the intended savior.
The permanent risk-adjustment program is meant to keep ACA insurers from cherry-picking healthier plan members over sicker, costlier ones. It collects payments from plans with healthier than average members and distributes that money to plans saddled with sick, high-cost members. The zero-sum program is based on a patient’s risk score, which factors in demographic information and health conditions. The CMS said 709 insurers participated in the risk-adjustment program.
The formula used to calculate payments in the risk-adjustment program has been criticized for unfairly favoring larger plans with more claims experience. Smaller companies that sell on the ACA’s exchanges have said they don’t have as much claims data, and therefore their membership base looks healthier than it is.
Several small plans and co-ops formed under the ACA have sued over the risk-adjustment formula. Evergreen Health co-op in Maryland, for instance, sued in June 2016 to block the federal government from requiring it to pay millions in risk-adjustment charges. Co-ops New Mexico Health Connections and Minuteman Health of Massachusetts filed similar suits last year.
This punishes start-up growth companies. A local example would be small group/individual market CareConnect’s $129M and Oscar’s $44M negative adjustment while United has had a windfall of nearly $330M positive adjustment. Put another way, this is an unintended welfare program for the rich legacy Insurers paid for by the very companies needing help in the market.
Risk-adjustment transfers for individual-market plans
Insurance Company
Risk-Adjustment Transfers
Oxford Health Plans
+$79,007,343
Empire HealthChoice HMO
+$36,682,246
HIP
+$8,036,081
UnitedHealthcare of New York
+$5,932,308
GHI
+$1,232,208
Aetna
-$52,360
WellCare
-$2,270,394
Affinity
-$9,261,635
Healthfirst PHSP
-$15,553,342
CareConnect
-$19,781,114
MetroPlus
-$30,691,628
Oscar
-$44,218,096
Fidelis Care
-$72,347,373
Risk-adjustment transfers for small-group market plans
Insurance Company
Risk-Adjustment Transfers
Oxford Health Insurance
+$254,933,461
Empire HealthChoice HMO
+$659,192
UnitedHealthcare Insurance Co. of New York
+$154,548
GHI
-$5,913
HealthFirst Health Plan
-$86,123
Empire HealthChoice Assurance
-$2,065,585
MetroPlus
-$4,170,812
Oxford Health Plans
-$9,938,585
HIP
-$35,246,058
Aetna
-$70,076,905
CareConnect
-$111,975,779
Cuomo Adjusting to Risk Adjustment?
Since last months NYS 2018 rate filing announcement the justifiable calls from members have been “Why are my #CareConnect rates going up 19%”. A whopping $119 Million in RISK ADJUSTMENT is owed to Center for Medicare Services. Alarmingly, this is not a political partisan issue and all agree on the flaws and unintended consequences. CMS has acknowledged the flaws but are working with a 5 year time frame. Sadly young companies cannot afford to stay in business by then.
The unofficial 3 tests presumptions of good regulations have been missed:
Regulations must be non-political
Designed with excellence
Executed perfectly
The good news is that CMS can change this regulation without an act of Congress. Regrettably, no State appeal has been victorious as of yet. For Governor Cuomo’s part the majority of the policies outlined in a press release from the governor’s office do not directly address the Risk Adjustment appeal and are already state law and would do nothing to protect New Yorkers’ from the skyrocketing costs they’d likely bear if the subsidies that underpin the Affordable Care Act are reduced or repealed.
In conclusion, to the clients suffering a 19% increase for 2018 the biggest fear is not having to change companies. The real fear, in fact, ought still to be will that company be around next year? This regulation, ironically,only affects individuals and small busnesses.
HealthPass New York will start offering OSCAR Health Plans effective Sept 1, 2017 to small employers. Oscar will offer eight plans with varying benefits package with 1 to 100 employees. The plans are available to small businesses located in New York City, Long Island, Westchester and Rockland counties. NJ residents can also access Hospitals & physicians through the NJ Qualcare PPO Network
HealthPass New York, a private insurance exchange for small employers. The addition of Oscar gives small businesses access to 3 health networks – Oxford, CareConnect and Oscar. Also, Guardian is the insurer of record for the ancillary benefits comprising dental, vision, life insurance, disability and accident insurance
Oscar entered the NY market on Jan 1, 2014 and had around 16,000 members. In 2015, it expanded coverage to New Jersey and grew to about 40,000 members. In 2016, Oscar had 145,000 members in New York, New Jersey, California, and Texas. Oscar’s cutting edge technology and pioneering benefits have simplified the consumer health insurance experience propelled easier access and understanding of health plans. Examples of success have been ease of physician locator, online appointment setting and no cost telemedicine 24/7. Additionally, some plans have $0 Copay generics and annual 3 free office visits
Why a Private Exchange? The advantage of a Private Exchange is the ability to empower employees with choice. Much like a 401K your employees can use a defined contribution allocation for benefits. As affordable health plan networks are increasingly smaller with specific coverage areas the one size show for all approach to benefits no longer works.
If you’re a small business owner who has concerns about payroll, filing paperwork, and complying with government regulations, co-employment may be the service you’ve been looking for. In some cases, a Private Exchange may NOT be right for you. With Health Care Reform your company may qualify for a small business tax credit or a be eligible for a large group discount under a PEO.
Try us on a custom demo, contact us at (855)667-4621.
