ACA requires an actuary to “calculate appropriate adjustments to the AV”

Employer plan sponsors who use HRA accounts or wrapping programs must certify the plans actuarial value by using the IRS calculator, and in cases where the calculator doesn’t fit, an Actuary must certify.

Certify your plans actuarial value

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Some plan designs do not fit neatly into a predetermined AV, you will need an actuary to calculate an accurate actuarial value used to report to employees. The actuarial calculator for ACA does not take into account every unique plan design circumstance. In this case, hand calculated AV will bridge the gap. This is an affordable endeavor that permits plans to continue to be creative in plan design options.

For instance, plan design teams are focused on including a 60% AV to meet company cost objectives. Confirming, or working with us, will optimize plan designs for both the employer cost equation and employee value.

Health Reform is here

MARCH 2010

Health reform was the initial plan but what we got was health insurance change. Here is a collection of quotes in late March, 2010.

Aspen Institute CEO Walter Isaacson talks politics, media in Holliday Forum

“The downside of the bill is that we shouldn’t make a change this big in a partisan fashion,” he said. “Compromise is an art we’ve lost.”

Holly A. Phillips, editor, Office of Communications & University Relations, March 2010, LSU;

Renowned experts discuss key statistics of health care reform at 2010 Keenan Summit

” In his introductory remarks, Loubet set the stage with some key statistics on the current state of health care in America: 46.3 million people uninsured, $16,771 per year cost of employer provided family coverage, 80% of those covered happy with current arrangements, 17% of the economy represented by health care, national deficit of $1.8 trillion, cost of health care legislation between $898 billion and $1.3 trillion, 52% of people worried they cannot pay for future health care in the event of serious illness, 47% worried they will not be able to afford all routine health services they need, and 20% reporting they or a family member delayed needed medical care in the past year due to cost.”

March 26, 2010, Henry Loubet, Chief Strategy Officer for Keenan;

Health care reform’s cost-cutting scalpel, Research technique decides effectiveness ignoring age, cost or marketing

“One often-heard criticism of the health-care reform legislation that President Barack Obama has now signed into law is that it won’t do enough to rein in the cost of treatment. U.S. medical spending has soared to $2.5 trillion per year (a price tag that has more than doubled in 15 years) and represents 18 percent of the nation’s gross domestic product. Can Obamacare begin to cope with that?

The answer is a qualified yes. Tucked inside the 2,400-page bill is an item (it’s right there on page 1,617) that has generated far less attention and political heat than other parts of the White House’s plan to expand medical coverage to 32 million uninsured Americans. The measure requires the U.S. to put aside $500 million or more a year for something called “comparative effectiveness research,” an ungainly name for a process Obama hopes will reduce costs. The studies, designed to show which drugs, devices, and medical treatments work best, could have an enormous impact on the delivery of health care in the years ahead, scrutinizing everything from cholesterol drugs and heart stents to hospital procedures.

By using statistics-driven research methods, its backers say, comparative effectiveness promises to bring scientific rigor to medical decision-making that is too often influenced by tradition and marketing. As such, the research is one of the few measures in the new law that has any chance of flattening America’s medical cost curve, according to Boston-based health-care analyst John Sullivan of Leerink Swann.

That also means that comparative effectiveness may be “a headwind for the health-care industry,” Sullivan says. “If research shows that less complex and maybe less expensive products and therapies work just as well, that is not good news” for many companies.”

By Alex Nussbaum, Meg Tirrell, Pat Wechsler and Tom Randall, March 26, 2010;

With Healthcare, Obama Scores His First Zogby A+

Pollster John Zogby gives President Obama his first A+.

“The president won a huge victory with healthcare reform. He showed that he could steer his way through obstacles from the right and the left and deliver on one of the changes he promised. Make no mistake how big this is. Can you remember anyone who stood up and shouted down Social Security? Name someone who took to the House floor and argued against Medicare. Does Strom Thurmond have a statue in the Capitol for opposing the civil rights bill? That’s just the point. Obama has done what no president has done before him—a gallery that includes two Roosevelts, Truman, and Clinton. Republicans are united against this and will run on their opposition in November—just as seniors will get their rebate to fill the doughnut on their prescription drugs and parents will see that their children cannot be prevented from coverage because of a pre-existing condition. There will be a classic ideological battle in 2010, and now the president has to sell what he has done. But he has done it, and it is one for the history books. The week belongs to him.”
Paul Bedard, U.S. News & World Report, March 26, 2010;

Obama’s health-care triumph? What a Pyrrhic victory

It’s too soon to celebrate the passing of the Democrats’ health-care reform bill.

“Yes, President Barack Obama’s 2010 health-care reform bill was a real watershed for the US, I enthusiastically told the lady from BBC Radio the day after the bill squeaked through the House. History will compare it to LBJ’s historic Civil Rights Act of 1964. Or even his creation of Medicare the following year. A couple of minutes into the live interview, though, I realised that I was in danger of getting carried away. I switched mood and said that it will be at least a decade before we know what the effects of the bill will actually be.

You really have to have lived in a country that has a pretty good national health-care system, such as Britain’s (the “socialised medicine” so dreaded by Americans), or a superb one, such as France’s (also financed by the government, but largely through non-profit-making insurance companies), before you fully understand what it is like to live in a country that has such a truly dire health system as America does.

Here, you have to pay almost twice as much as in Britain for medical treatment, yet must expect to die a year earlier. The French, still so patronised here, live three years longer than the average American. So, now that health insurance, under Obama’s bill, will cover 32 million more Americans (note, a further 24 million will still be left with no medical insurance what­soever in 2019), is this legislation the big breakthrough for US health care?”

Andrew Stephen, NewStatesman, March 26, 2010

Happy birthday to me, Obamacare is here

March 26, 2010 happy birthday to me

Wow, that’s all that can be said for the “hair raising” on the back of my neck. Since the signing of Health care reform in Washington March 23rd, my world has changed. In the last two weeks I have met with several new customers, designed a web page you can find at, link will be available by the end of the week.

Everyone will be affected by this reform bill, for example, individual employees will be affected. It’s anticipated that half of those not covered today will still have no coverage in the year 2019.

The costs of reform to large employers is expected to be no change, that means health care for large employers still goes up each year, projected at 5% per year.

There are more than 2,000 references to the “secretary” who is directed who shall direct regulators to determine something. Yes, the Secretary will create no less than 2,000 sets of regulations. What does this mean, well it could be fairly minor or it could be quite significant. My money is on the more significant. To help you, a work group I’m part of has posted on the internet our work about the law.

Right, about the title? Yes, today is my birthday.

Healthcare CEO Roundtable

Metro Detroit Association of Health Underwriters

January 28, 2010

Healthcare CEO Roundtable

The topic was hot – health care reform or insurance reform? And we had the chance to hear from some of leading CEOs in the region:

· Mark A. Kelly, M.D. Executive Vice President, Henry Ford Health and CEO of The Henry Ford Medical Group

· Kimberly H. Horn, President and CEO, Priority Health

· Kevin Klobucar, President, Blue Care Network of Michigan (BCN)

· Mindi K. Fynke, President and Founder, Employee Health Insurance Management

· William Alvin, President and CEO, Health Alliance Plan (HAP) and Senior Vice President, Henry Ford Health System

Several hundred agents selling group health insurance gathered in Southfield to join in the conversation going on across the country about healthcare. Of special concern was the Michigan market, affected by deep economic distress.

Moderator Jeff Nielson of Blue Cross Blue Shield led the panel through a number of issues and questions.


There was universal agreement among these leaders on five main points put forth by Mindi Fynk:

· More people need to be covered by healthcare insurance

· Uninsured need access to coverage and to be covered

· Solutions shouldn’t stifle competition or innovation

· Solutions shouldn’t include tax hikes

· Healthcare reform has turned into health insurance reform

At the time of the meeting, Washington still hadn’t come up with a comprehensive bill addressing healthcare reform. But the panelists agreed that the initial goal of healthcare reform was morphing into insurance reform.

“Reform only focused on 10% o cost. We need to focus no on delivery of actual care,” said William Alvin. “There is tremendous inefficiency in the way we provide care. It is a disorganized healthcare system and bill on reform never focused on this.”

It was clear the healthcare system works in silos. Kevin Klobucar commented, “Today the coordinated care system works very independently; patient medical home (described as the next evolution of care) engages the physician and patient. The system can’t measure today the whole patient outcome and this must be focused on in the future.”

The panel agreed that what started as wholesale reform of the system in general has been watered down to a technical bill adjusting and reforming insurance. It doesn’t address the underlying problem in U.S. healthcare.

And that the problem is the current reimbursement rates are based on discrete/individual services. Physicians, to protect their practice, try and increase those volumes and, in so doing, leave less room and opportunity to focus on overall patient health.

Panel members agreed that physicians should be focusing on improving outcome, be supported on prevention tactics and getting patients engaged in taking care of their own health.

“We must figure out a way to get people engaged. Just having a prevention benefit is not enough,” said Klobucar.

The existing system supports treating disease, reimburses procedures and tests and limits the physician’s time with patients to really engage in preventative medicine. And many of our current physicians and specialists haven’t been trained in preventative medicine – it’s secondary to their own specialty and expertise.

So what we in the business are seeing that, despite current prevention programs, people still aren’t getting healthier. While insurance covers some preventative care, it’s not nearly comprehensive enough – for those covered, much less those without insurance or who are underinsured – to avoid disease, keep people healthy and on track with a healthy lifestyle.

Real healthcare reform would focus on a deeper engagement of the physician with the patient – a real partnership in individual health. But that takes time, and time is money. The current reimbursement process discourages this kind of real health partnership.

As an industry we need to step up to this challenge, become activists and be more aggressive in insisting on real, fundamental change in this country’s healthcare. “The current opportunity is now for the industry to activate. We need to more aggressive in making changes. We need to do it and not have it done to us,” said Kim Horn.

“Physicians here in Michigan are frightened; they have fewer and fewer patients and of those patients remaining less of them haveinsurance for payment. E-prescribing learning and adaptation took hold quickly here. Physician incentives can change just as easily to pay for performance. Paying for performance means a way to do the right thing and physicians recognize the value for both their patients and themselves,” said Dr. Mark Kelly.

This was a great opportunity to meet with our colleagues, learn from leaders in the healthcare field and get more acquainted with the far-ranging concerns of healthcare reform.

Conversation recorded by Don Watza, CEBS