Is It Ever a Good Idea to Decline Employer Insurance Coverage?

by L.A.S.

Much to my surprise, a recent article on Wise Bread dot com suggested there might be three occasions when you might reasonably consider declining your employer's health plan.

DECLINE your employer's health plan? The very thought at one time would certainly have made one's blood run cold, especially for those who have families on such a plan.

First, to clarify. They are NOT suggesting that you simply go without insurance. They are simply saying that you may have other viable options.

You may be one of the lucky few who can find a better deal by yourself, whether online or just because you have few medical needs; perhaps you wish to go with a medical savings account or one of those self-directed programs. You may be offered a plan for a supplemental type of insurance such as vision or dental that is more than just a few bucks per month -- and has so little benefit that it defies the purpose of insurance. Or you may be able to obtain a fine plan through another group or through your spouse's employment.

I have probably been in any of those situations myself. For a time, I had a high-deductible health plan with my (former) employer that was a free option. Yes, it was free coverage from the very nice employer, as an alternative to the sticker shock from a huge premium increase.

My vision and dental coverage WAS only a couple bucks a month, so I kept it as long as the premiums were so low. But eventually those premiums rose even faster than the medical plan premiums. And when I went in for a service at a local dentist, I was always forced to sign a paper saying that I would pay the balance that the insurance did not cover. Whoa, that defeated the whole purpose of insurance, to my mind. So eventually, when the premiums reached a break-even point, I just dropped it.

And thankfully, I have found some insurances through other groups that I belong to. I have mentioned some of these strategies in my articles here at Blogspot. People over 50 may find coverage through a membership in AARP, if nothing else is available. Perhaps you belong to a fraternal organization or a club, or a professional group, or even AAA. Even your membership in a buying club like Sam's Club may bring you special prices, not on insurance, but on vision and prescription services. Any or all of them may have an insurance plan or plans for their membership, with no medical exam or other pre-qualification required.

You can read the whole article and decide for yourself at -- www.wisebread.com/3-times-to-consider-declining-your-employers-health-coverage

Health Co-ops Are Making Medicine Fun Again

by L.A.S.

Another option when it comes to dispensing health care is the health co-op, where the patient members are in control of the entity.
One example is the Group Health Cooperative in Oregon. It was created way back in 1947 by farmers and loggers who pooled their resources to cover the most basic primary care. Since that time, the co-op has grown to over a half million members, the third largest insurer in Oregon.

It operates similar to an HMO. It has premiums and co-pays. Patients have to see providers who are in the network. Doctors work for the company and are paid a salary. This means they are not forced to cram twenty or more patients into their daily schedules.
They have more time with each patient and can be more proactive.

One of the great features of the Oregon co-op is that they have invested in electronic medical records which reduces errors, enables doctors to coordinate care, and also lets patients check their charts online. Whether it was this innovation or the emphasis on primary care, the result has been a drop in emergency room costs by 29 percent.
But replicating the success of Group Health is a real challenge. Many health care co-ops were born in the Great Depression and folded later when government funding was withdrawn.
However, HHS Cabinet Secretary Kathleen Sebelius has signaled that the Obama administration might support the idea of co-ops as an option to reduce the cost of health care.
It is an option worth serious consideration, even with all the challenges of starting one from the ground up.
An article on health co-ops ran in USA Today and you may read it here: http://www.usatoday.com/money/industries/health/2009-08-20-group-health-insurance_N.htm

Alphabetical List of Long-Term Care Insurance Carriers

Accurate as of January 2009. Most plans use as a trigger the inability to meet 2 of the 6 ADL's (activities of daily living which are bathing, continence, dressing, eating, toileting, and transferring), and many also accept Cognitive Impairment. No endorsement is implied or given by listing these insurance carriers. You must determine which plan is best for you.

Advanced Resources Marketing --
www.armltc.com 617-783-2622. Group and individual. Available in all states. Issue ages 18-85. Minimum group size 10. Trigger: TQ. Portable. Elimination periods zero to 100 days.

Aim Marketing & Ins. Services --
www.AimMarketing.com 600-245-2467. Available in all states. Issue ages 25-80. Minimum group size three. Portable. Elimination periods – all available.

AJF Consultants --
www.ajfconsultants.com 866-901-5323. Available in all states. Issue ages: any. Minimum group size: any. Portable. Elimination periods: none.

Allianz Life --
www.allianzlife.com 800-950-7372. Available in all states EXCEPT CA HI MA NY. Issue ages 18-84. Minimum group size 10. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – 7, 30, 60, 90, 180, 365.

American Financial --
www.afmus.com 800-880-3072. Available in all states. Issue ages 18-84. Minimum group size five. Trigger: Unable to meet 2 of 6 ADLs or cognitive. Portable. Elimination periods – zero to 365.

American Independent --
www.aimforltc.com 800-672-7202. Available in AK AZ AR CA CO HI ID KS LA ME MI MO MT NE NV NM NY OK OR TX UT VT WA WY. Issue ages 18-99. Minimum group size five. Portable. Elimination periods – many options. Many benefit triggers to choose from.

American Insurnet Agency --
www.AmericanInsurnet.com 800-333-4638. Available in all states. Issue ages 18-89. Minimum group size five. Trigger: Unable to meet 2 of 6 ADLs or cognitive. Portable. Elimination periods – zero day for home care; zero-30-90-180-354 for nursing home.

American Life & Health --
www.amlifegroup.com 800-992-1492. Available in all states EXCEPT CA CT KS ME MA NH NJ NY PA RI VT AND WA. Issue ages 18-84. Minimum group size: case by case. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – 90 days only.

Assurity Life Insurance Co. --
www.assurity.com 888-276-7619, x 3774. Available in all states EXCEPT FL NY AND VT. Issue ages 40-84. Minimum group size, none, but discount with 10 members. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 0, 30, 90, 180.

Berkshire Life Insurance --
www.TheBerkshire.com 888-505-8743. Available in all states. Issue ages 40-84. Minimum group size, none, but discount with 10 members. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 0, 30, 90, 180.

Equitable Life & Casualty --
www.Equilife.com 800-352-5121. Available in all states EXCEPT AK CA CT DE DC FL GA HI ME MD MA MN NH NJ NY PA RI VT WA WI. Issue ages 18-84. Minimum group size, none. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment (requires physician statement). Portable. Elimination periods – 0, 30, 60, 90, 120, 180, 365.

GamePlan Financial --
www.gameplanfinancial.com 770-517-2765. Available in all states. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 0, to 365.

Gelbwaks Insurance --
www.gelbwaks.cm 954-236-9999 x104. Available in all states. Issue ages 18-70. Minimum group size three. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 20 to 180 days.

Golden Benefits --
goldenbenefits.com 415-454-3359. Available in California. Issue ages 18-79. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – 0, 30, 60, 90.

Great American Life --
www.aimsltc.com 800-325-9876. Available in all states EXCEPT CA CT HI NJ NY. Issue ages 18-89. Minimum group size, five. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 30, 60, 100, 180, 365.

Guaranty Income Life --
www.gilico.com 800-535-8110 x292. Available in AL AZ AR CA CO FL GA IL IN IA KY LA MI MS MO MT NE NV NM NC ND OH OK OR SC TN TX UT WY. Issue ages to age 85. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment (requires physician statement). Portable. Elimination periods – 90.

Harbor Insurance --
www.HarborIns.com 866-424-2167. Available in all states EXCEPT NY. Issue ages varies by carrier. Minimum group size, any. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – varies by carrier.

Insurance Network America --
www.InsuranceNetwork.com 800-456-7999. Available in all states EXCEPT CA HI MA NY. Issue ages 18-84. Minimum group size, one. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 7, 30, 60, 90, 180, 365.

John Hancock --
www.JohnHancockLTC.com 800-330-4598, 800-330-4582. CareChoice plan available in AL AK AZ AR CT DC GA IL IN IA KS KY ME MA MS MO NV NH NM NY OH OK OR RI SC SD WV WI and WY. Corporate Choice plan available in all states EXCEPT CA FL TX WA. Corporate Solutions plan available in all states EXCEPT CA NY. Issue ages 18 to retirement. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 30, 60, 90.

LifeSecure Insurance Co. --
www.YourLifeSecure.com 810-220-4613. Available in AL AZ AR CO DE DC FL GA HI ID IL IN IA KS KY LA MD MI MN MS MO MT NE NV NM ND OH OK OR SC SD TN TX UT VA WV WI WY. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 90.

LTCi Decision Systems --
www.LTCia.com 800-360-9853 or 720-922-9060. No details were furnished to reporting group.

MedAmerica Insurance Co. --
www.medamericaltc.com 800-544-0327. Available in all states. Issue ages 18-85. Minimum group size ten. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – 30, 60, 90, 180 days.

Metropolitan Life Insurance --
www.metlife.com 888-776-3882. Available in all states. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 20, 45, 100 days.

Nationwide Financial --
www.nationwide.com 800-321-6064. Available in all states EXCEPT MN MT WA. Issue ages 21-80. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 90 days.

Pacific Advisors --
www.PacificAdvisors.com 877-455-9580. Available in all states. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 30 to 180.

Rampart America --
www.RampartAmerica.com 800-221-4623. Available in all states. Issue ages 18-85. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – 30, 60, 90.

Roster Financial --
www.RosterFinancial.com 800-933-6632. Available in all states. Issue ages 18-85. Minimum group size, five. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 30, 60, 90, 180 days.

Senior Market Sales --
www.SeniorMarketSales.com 800-786-5566 x4. Available in all states. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – zero to 730, depending on carrier.

The Prudential --
www.Prudential.com 800-732-0416. Available in all states. Issue ages 18-79. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 30, 60, 90, 120, 180 out of 365 days.

Transamerica --
www.TransamericaLTC.com 817-285-3604. Available in all states EXCEPT GA ID MT PA VT. Issue ages 18-79. Minimum group size, five. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – zero, 30, 60, 90, or 180.

Trustmark --
www.TrustmarkSolutions.com 800-840-4692. Available in all states. Issue ages 18-80. Minimum group size, 100. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 90 days.

Underwriters Marketing Service --
www.Callums.com 800-524-1774. Available in all states. Issue ages 18-84. Minimum group size, three. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – varies.

Unum --
Unum.com 800-421-0344. Two plans, GLTC Advantage and Group LTC. Available in all states. Issue ages 18-80. Minimum group size, ten or 15 depending on which plan is selected. Trigger: Unable to meet 2 of 6 ADLs or cognitive impairment. Portable. Elimination periods – 20 to 730 days.

Wachovia Insurance Services --
www.Wachovia.com 803-765-3520. Available in all states. Issue ages 18-75. Minimum group size, ten. Trigger: Unable to meet 2 of 6 ADLs. Portable. Elimination periods – most have 90-100 days.

Zenith Marketing Group --
www.ZenithMarketing.com 800-733-0054. Available in all states. Issue ages 18-79. Minimum group size, four. Trigger: Unable to meet 2 of 6 ADLs or severe cognitive impairment. Portable. Elimination periods – 30, 90, 180, 365.

IRS Rule Changes Sweeten HSA Pot for Employers, Employees

Health savings accounts (HSAs) will likely prove even more popular than ever due to a sweetening of favorable tax treatments and more funding options.

Readers may want to check with their financial advisor about the new IRS guidelines that allow a transfer of individual retirement account (IRA) funds to an HSA; this transfer is tax-free. Second, employees are no longer subject to the 10 percent additional tax if they use their IRA funds to pay for medical benefits -- referring to IRC Sec. 72(t). Thirdly, qualified employees may contribute IRA funds to their HSA without tax.

Q: If I already have an HSA for myself and want to put some money into a high-deductible health plan (HDHP) for my family, can I do that?
A: Yes. If you have an HSA for yourself and you buy a family HDHPan HSA owner has a self-only high deductible health plan (HDHP) and buys a family HDHP, you can make that second transfer during the same taxable year. The fund distribution will still be without tax. One big advantage to doing this is that you will reduce your tax liability AND lower your health insurance premium. That is potentially, at least -- it will all still depend on your total financial picture and for that, you ought to go in to see your own financial advisor.

Fourth, the IRS also raised the ceiling for individuals and families to their HSAs for the 2009 tax year. Individuals will now be able to contribute up to $3,000 per year; families can contribute a maximum of $5,800 per year. (NOTE: The current maximum limit is $2,900 for individuals and $5,650 for families. The catch-up contribution for people who are 55 years old and up is increasing to $1000, from the current $900.)

The IRS released other new guidelines expected to boost the HSA market by further increasing employers’ adoption of HSA-linked consumer-driven health-care plans (CDHP).

Employers received much-clamored-for clarifying guidelines such as these (and employees will probably have to get the full details from your Employee Benefits department):

-- ON-SITE CLINICS that provide free or low-cost services will NOT affect an employees’ eligibility for an HSA. ALLOWED SERVICES INCLUDE: treating on-the-job injuries, immunizations, annual exams.

-- HOWEVER, if the clinic provides more significant medical benefits, you, the employee, are not eligible for an HSA. Example: a hospital permits its employees to receive medical treatment at its facilities for all of their medical needs for either no cost or at a reduced rate. (I and probably millions of you would probably give our eyeteeth to have such a generous employer.)

-- If an employer mistakenly contributes to your HSA, the employer is allowed to retrieve the funds by asking the financial institution holding the account (ie the bank or other seller) to return them. Otherwise, the employer may treat this amount as part of your income. (ie that means this could raise your IRS obligation; you are probably better off returning the money to the employer!)

A special note to HSA holders age 65 and up: You may use money in your HSA to cover Medicare Part D prescription drug PREMIUMS. If your spouse is older than 65 but you yourself are younger than 65, the enrollee’s HSA funds can NOT be used to cover your spouse’s Medicare Part D premiums without being part of your taxable income.

Hybrid financing is new and is expected fuel further growth in HSA accounts. Under this strategy, your employer pays ALL of an HDHP for you and your fellow workers AND gives each employee a defined cash allowance. Employees can decide how to use that cash.

Example: an employer provides a $2,000 deductible HDHP. You (employee) pay all costs under $2,000 while the insurance company covers EVERYTHING above that -- ie, your maximum out-of-pocket amount is $2,000 if you need surgery or pay a hospital bill – an amount similar to many traditional PPO plans. (Actually a lot of PPOs or indemnity policies may have limits of $2500, $3000, or even $5000. That may seem like a lot, but often that is the only way to keep the premiums down.)

Your monthly cash allowance of $125 (or $1,500 a year) also from your employer? You may choose to put that into your HSA, OR use it to buy a better health plan.

An unnamed small company in the communications sector used this hybrid financing strategy to walk away from a traditional insurer that quoted monthly premiums of $1800 per employee. It is no wonder that the employer switched to a high-deductible plan and an HSA, is it? This company is very generous and provides a $10,000 deductible for their employees plus the HSA, which is owned by the company.

Employees who had high medical expenses and depleted their HSAs, were reimbursed up to the deductible out of the HRA. This company pays a premium of only about $600 a month per employee (family coverage). The employees do pay toward the premium; the amount varies depending on whether it is a single or family plan.

It is hoped that the IRS changes will help both employers and employees contain the cost of healthcare. As an example, the above employer calculated that even if every employee got sick, the company would still save 18 percent compared to traditional healthcare insurance. And HSAs are much less likely to suffer annual hikes in premiums like those that plagued small businesses in the past decade.

Industry statistics show that HSAs grew by 73 percent from late 2006 to the beginning of 2008. The total dollar amounts in those HSAs also increased by 140 percent during the same time frame. It is a bit of a mystery why this popularity has not been evenly expressed across the country.

For example, a study showed that only 2.4 percent of residents enrolled in private health insurance in Missouri, 2.1 percent in Oklahoma, and 3.2 percent in Kansas have used HSAs.

Possible reasons that people are not switching to HSAs or other high-deductible plans: 1) they opt to stay with traditional, low-deductible healthcare plans, 2) the HSA is still pretty new, and perhaps they do not have anyone to familiarize them with it.

Big emphasis on HSAs and high-deductible plans

Many employers want to take a more active role in enticing workers to form the habits and get the recommended screenings that can protect their long-term health. To encourage employees to stick with preventive-care maintenance medications such as drugs to control high blood pressure, next year Guardian hopes to be able to waive the copay on such drugs, Mansberg said.

A growing number of employers are embracing incentive programs that reward workers who take health risk assessments, attend onsite health fairs or participate in biometric screenings, where they're measured for height, weight, blood pressure and other health-risk indicators, she said. "The vendors we work with make the information available to your primary-care physician so [he or she is] kept in the loop of what's going on."

A break on premiums or a small cash incentive can persuade busy workers to make their health a priority, Mansberg said. "A lot of times people will take care of their kids but they don't take care of themselves the way they should. It's another way to make it top of mind."

Full story from Market Watch -- www.marketwatch.com/News/Story/Story.aspx?guid=38e267addf124ae18d6733a44a95895a&siteid=nwtpf&sguid=-ELWpQNc4kyEAAp-GHdHfQ

Some employers are dropping formal group insurance coverage completely or just sign up with administrative services like AdminiStaff. The advantage of these outside administrators is that it saves the company hours of processing time for check deductions, while allowing employees to pick and choose insurance plans that fit their needs.
Not selling you anything -- just acknowledging that there are other options out there that are catching on.

If You Depend on Your Employer for Health Ins., Don't Vote McCain

Hi, --
I don't generally talk about politics at all on this site. However, there are some clear differences between the two major presidential candidates when it comes down to how your health insurance will be affected.
It is already pretty clear that Sen. John McCain has plans to torpedo employer-paid health insurance coverage. How can a president do that? Pretty easy if he is able to push thru a proposed elimination of the tax break for the employer.
Currently the only way that employers are able to offer group coverage at all is because of the tax exclusion employer-paid health insurance.
Ostensibly the goal is to push individuals into state-run pools. But that means that individuals will have to pay 100% of their premiums, whereas now they pay anywhere from 20% to 50%. Some employers do not contribute anything now; they just sign up with an outside administrator like Administaff and let employees pick and choose what they need. And pay 100% of the cost.
Americans are being squeezed between spiraling increases in food bills, gas prices, and often in their mortgages if they got caught in the mortgage credit crunch. Where are they going to get the extra dollars to pay for 100% of their health insurance coverage too? AND pay income taxes on the benefits from your insurance plan??? Are they crazy???Here's a link to a great article on the changes being proposed; this is part one of a two-parter. I hope you benefit from reading it.
HEADLINE: McCain's Health Care Plan: Gut Employer-Based Insurance
http://www.alternet.org/mediaculture/93734/?page=entire
An Excerpt: So far, the press has failed to examine what's at stake here for workers and their bosses -- that, in the long run, employer coverage could disappear, and that, in the short run, they may have to pay taxes on some portion of their health benefits, no matter who wins in November. In effect, it's an unspoken tax increase which has yet to surface in campaign conversation.