Two Major Benefits Enabling Success of Health Insurance Exchange

The U.S. health insurance market is at its peak of major transformation essentially from an employer-based model to something that directly involves more and more consumers and employees. In this scenario, the private health insurance marketplaces carrying a defined approach helps acting as a significant catalyst to the process. There are at least 10 factors that enables a private health insurance exchange to be successful in providing seamless healthcare facilities to its consumers, two of them have been discussed here:

1. Abundant coverage capitalizing

The present health care system provides two ways to fund how to buy health insurance plans.

One- funding health insurance on the basis of after-tax expenditure. Here, enrollees pay the coverage out-of-pocket, without having any tax preference while buying the plan. This kind of coverage is commonly practised in the individual market of health care plans. In this kind of plan, Government or employer does not provide subsidies to the coverage.

Two- This is an employer-based buying of healthcare coverage. In this plan, the employer will typically pay either the entire or a part of the employee’s medical coverage. This plan typically reduces the employee’s cost incurred towards the plan. Moreover, even though a portion of the employer’s contribution comes from employee’s compensation, this portion paid by the employer will not be taxable to employee’s income tax. If the employee is paying a portion of the subsidy, employers usually provide tax exemption plans so that employee pays that amount before his tax gets calculated on his salary. The tax exemption feature is the best benefit provided by employer-based health insurance plan.

Any successful health insurance exchange will enable a smooth process for a health insurance enrollee to buy the coverage. This help will be irrespective of whether the enrollee is paying it entirely from his pocket or his employer is buying the coverage for him.

It will be the task of private health insurance exchange to provide a defined system of payment in a situation where the employer is just contributing in funding of the medical coverage buying. The exchange may either outsource the functions of payroll reduction to another business that is specially involved in giving payroll services or provide the service in-house. In both situations the task of the exchange is to enable smooth and error-free transfer of funds to the insurer company that is providing the coverage.

2. Stock of most of the important health plans

Yet another factor that makes private health insurance exchange successful is providing the consumer a plethora of health insurance plans to choose from. There can be more that 15 to 20 health plans that an exchange has in stock- all ranging from high-cost to even the minimum low-cost sharing health insurance plans. These variety of healthcare designs provides both the individual consumer and the employer to choose that funding system that suits him best. This actually helps in huge cost saving for both the individual and employer.

An important point of observation for private healthcare marketplaces is the wide array of major health insurance plans that are offered by many carriers. As most of the plans today get underwritten on individual basis, the carriers are usually managing their consumer’s risks that they have covered under the insurance plan.

There is ample likelihood of private exchanges to flourish. It is highly possible that there will be many undifferentiated offerings that will get implemented soon. However, to win in this marketplace, the exchange will require to differentiate all by itself through creation and sharpening a significant value proposition. 

Student Health Insurance Plans and Their Benefits

For those who are below 26 years of age, thanks to Obamacare, you are under the coverage of your parents still. However, not every individual is able to finish his studies before the age of 26 years. Most students doing higher studies, or studying multiple faculties have crossed the threshold of 26 years and are no longer covered under their parent’s health insurance plans. If purchasing health insurance plan can be a nightmare for those who are earning, for those who are students, it must be really scary.

So, should these students discontinue their studies and get into some jobs, just to be able to pay for expensive medical care? Thanks to Students Health Insurance Plan (SHIP), this category of the U.S. citizen are not dying being unable to pay for their health care. There are two coverage cycles under SHIP- fall (August 15^th to December 31^st) and Spring (January 1^st to July 31^st). Those who wish to register for Fall 2017, your coverage will be effective from August 1^st 2017.

The initial health care, except for urgent care and emergency care, has to begin at University Health Services. These services have to be authorized by the office of Student health insurance to enable payment of the cares provided. Every state and its University provides certain benefits to the students under SHIP. These benefits are somewhat same across all Universities, leaving certain small differences (for HMO plan):

1. All preventative care are fully covered (100% coverage) and you need not pay a single cent for it.
2. In case of primary care, you as student will require to pay $15 in copayment.
3. In case you need seeing a specialist, if this specialist is from in-network and referred by your primary care provider (PCP), you need to pay only $15.
4. For urgent care required under UHS, you will pay $30 and for outside UHS, it is $50.
5. Students requiring counseling for certain mental or behavioral disparities will receive first five counseling at UHS for free. However, for the same service outside UHS, the student requires to copay $15.
6. In case you require an emergency room, you pay $100 upfront as copay. Moreover, 90% of rest of the services will be paid by your SHIP, other than lab tests and x-rays.
7. For hospitalization, you need to pay only 10% of the coinsurance after calculating the deductibles, rest 90% your SHIP will take care.
8. For your lab tests and x-rays, you pay 10% coinsurance again, while your insurer will cover the rest 90% after checking your deductibles.
9. For all your prescription drugs, you need to pay $5 for generic, $40 for official list of describable medicines, and $25 for brand name prescription medicines.

In case you are not covered under your parent’s health insurance coverage and you are still a student, you may not worry going untreated due to lack of funds. The Student Health Insurance Plan (SHIP) takes care of majority of your health care costs, leaving you tension free to concentrate on your work. Of course, you will need to make some research on which plans under your university will provide the best facilities for your medical care services. 

Health Insurance Companies and 5 Healthcare Options for Small Enterprises

The recent news of health insurance companies like Aetna, Humana, Athema, etc. getting merged is leaving a lot of speculations in the health insurance marketplace. While the practicing doctors and hospital authorities feel it will leave many of them in out-of-network facilities, there are many financiers who see this merger as a good possibility to reduce the cost of expensive health insurance in the USA.

But, what do the health insurance companies do? Or, how do they function. Mentioned below are a few ways health insurance companies or brokers help small scale employers with ideal sort of small group health coverage.

If you are an insurance agent or a small entrepreneur, you will feel like issuing the ACA to your employees/clients. However, if you are a company with less than 50 employees, you may not provide any health insurance to your staff. There are absolutely clear options provided for small group health coverage.

In 2016, you have 5 options mainly for providing health insurance to your employees:

1. Private Exchange
2. The SHOP marketplace
3. Co-operative
4. Small group plan (private)
5. Individual health coverage (you may or may not take defined allowance contribution)

1. Private exchange

Private exchange is the most sort about healthcare marketplaces today. When small employers go for private exchanges, they provide the employees with a set of pre-defined contribution towards different plans available. You can divide the options into either individual- or even group- health insurance plans. The biggest advantage in private exchange is the defined contribution planning.

Insurance agents either work with a private health insurance company or defined contribution and provide such options to smaller groups. There are innumerable small start ups and also new divisions of big names in insurance companies that offer these small group- or individual-health insurance.

2. The SHOP marketplace

These are marketplaces run by state- or Federal- exchanges that also sell group health insurance for small enterprises. SHOP can be a good healthcare exchange for all those employers who have 50 or less employees, provided they meet some essential criteria. For instance, Massachusetts requires employers contributing 50 percent of the total health insurance cost in SHOP. Those employers with staff strength between 1-5 must have cent percent employee enrollment, while with 6-50 employees, 75% of the employees need to be enrolled.

Small business groups that are eligible, SHOP provides access to tax credits exclusively available through its platform.

3. Co-operative

The co-op is a more like a traditional health insurance approach for all small groups. The main idea is- the co-operative will increase the purchasing power, the risk of which will be spread across a larger group. There is a different structure for every co-operative, and depending on the state’s underwriting laws plus the co-op, it can decide about providing better insurance rates than the SHOP or small group, to get into the open market.

4. Small group plan

Small groups also have an option of buying private plans from small groups. They may find further carriers and options to choose from within the private market just like SHOP. There are only some states that have such one to two small group plans to choose.

5. Individual health coverage (enrollees may or may not take defined contribution)

This is fairly a simple approach that has achieved results. It allows employees to buy individual health plans using a public exchange or even a broker. Employees have the option to select from any plan and carrier present in the marketplace. Individual employees can even get discounts on the paid premiums using the tax credits for individual health plans.

In an event where the small group employer wants to contribute towards his employee’s insurance premiums, can easily use the defined contribution allowances and assist his employees in paying the non-subsidized part of the insurance premium.

Health insurance companies generally involve to help in setting up those defined contributions and sell employees the individual plans. They thus act as consultants for these small entrepreneurs. This solution works best for small groups who are heavily priced out in any group health coverage. It also works well for those employers who are not eligible to provide group healthcare coverage, or those who wish to start for the first time. In case you do not have the administrative capability to use a group health insurance policy, you may go for individual health coverage.

For all the time, health insurance companies have been trying to help employers gather friendly group health insurance plans, so that they do not suffer maximum burden from this expensive industry. However, this was only possible as the number of companies were more, hence more competition. Now, with mergers happening and competitions going down, whether the health insurance companies keep their rates low is something everybody is curious about. However, companies like Aetna and Humana say they will be able to provide better rates in insurance premiums, as the hard work will be divided between two giants, not fighting each other but helping them instead.