Great news for the nearly 167,000 Tennesseans who don't have access to health insurance. Tennessee Republican lawmakers advanced a plan on February 27th that would overall how TN provides health insurance to our low income and disabled residents.
Being in the health insurance industry I have long struggled with the ACA providing subsidies and low deductible health plans to many of our lower income residents but not those who are truly poor. You see, if you earn more than 138% of the Federal Poverty Level you do not qualify for any subsidies through the Affordable Care Act and are left on the sidelines because we do not have offer robust Medicaid coverage. For a single person this is $13,724 and $27,945 for a family of four.
Mark and I attended a meeting today from a healthcare leader who is trying to build an Association Health Plan (AHP) for Tennessee small businesses. It became clear very quickly this is not going to be an easy endeavor but it could be a game changer moving forward.
President Trump signed an executive order in 2018 allowing associations to offer heath insurance to its members. Associations cannot be formed just to provide health insurance but this will be a huge benefit if affordable coverage becomes available by grouping many small businesses together. The current rules would allow a sole proprietor to buy group insurance with what we hope will be large group pricing.
While it is a federal law that allows the formation of an Association Health Plan, TN will have its own laws that are overseen by the Tennessee State insurance commissioner. It is not likely we will see insurance sold across state lines because of this. The rules today allow Associations based on companies in related industries or in a common geographical region to offer health insurance on a group basis.
The health plans would not be able to discriminate based on individual health conditions or high claims. This is a really big deal but also makes implementing a plan very difficult because you won't know the risk of the enrollee's until claims start coming in. Health insurance works by the law of large numbers and for an association plan to be successful, they will need strong adoption from the first day.
While association plans are probably still a year or two away, companies with healthy employees are benefiting today with "level funded" health insurance plans. These plans avoid many of the ACA rules and community rates by using a "self insured" platform which allows them to ask health questions and rate groups based on their actual risk. This has saved several of our clients tens of thousands of dollars and given them much more flexibility in designing the health plan that works best for their employees. We would be happy to get pricing for your company if you think your employees are healthier than most.
The good news in all this is carriers, entrepreneurs and some government officials are looking for ways to lower healthcare costs. We will surely see successes and failures but at the end of the day choice and competition will keep rates as low as possible.
How about if your insurance company paid you $500 plus paid for a trip to Mexico? They will pay for lodging and transportation and even provide you with a driver. Sound too good to be true? If you are a Utah State employee or retiree it is part of your health plan. The reason, medical and pharmacy tourism saves enough money to pay for a free trip and still reduce healthcare costs.
When Michelle Fenner signed up to run this year's Los Angeles Marathon, it got her thinking: Tijuana, Mexico, is only a 2 1/2-hour drive from LA. Why not take a trip across the border and buy some insulin for her son?
"It's so easy to just go across the border," Fenner mused.
This idea had been in the back of Fenner's mind for a while. Her son was diagnosed with Type 1 diabetes nine years ago, meaning he needs daily injections of insulin to stay alive. The list price of the modern generation of insulin has skyrocketed since then. On one trip to the pharmacy last year, Fenner was told that a three-month supply of insulin would cost her $3,700.
That same supply would cost only about $600 in Mexico.
'Right to Shop' legislation
In Utah last year, the Public Employee Health Plan took this idea to a new level with its voluntary Pharmacy Tourism Program. For certain PEHP members who use any of 13 costly prescription medications — including the popular arthritis drug Humira — the insurer will foot the bill to fly the patient and a companion to San Diego, then drive them to a hospital in Tijuana, Mexico, to pick up a 90-day supply of medicine.
The program was part of a Right to Shop bill championed by health care economist and Utah state representative Norm Thurston in 2018. Thurston says there is not yet enough data to know how much in savings the program provides; the first patients traveled to Tijuana in December.
But, Thurston says, he expects that in the next six months, savings will likely be "in the ballpark of $1 million."
Posted on 02/11/2019 10:50 AM by Benefit Brokers, LLC
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