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. 
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. | Dec 10, 2015 | NY News, Obamacare, Small Business Group Health
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.”
ISSUE SUMMARY
