Health Tip of the Week: September 28, 2009

Problem: My carrier tells me how great their discounts are with medical providers; however, my health care cost continue to rise at double digit rates!!

Many people now believe that PPO’s have outlived their usefulness. For example, a recent Boston Globe article talks of collusion between BCBS and Partners Health to artificially raise reimbursement rates while providing BCBS with a “great discount” off artificially high rates! The employers are left to pick up the tab.

The solution: There are two solutions to overcome this issue. (1) Identify medical providers, both locally and nationally, with the lowest reported cost to Medicare, and arrange financial incentives in the plan to steer patients to these facilities. If a patient needs to travel more than a reasonable distance (Perhaps 125 Miles) to a high quality hospital for care, the plan would pay for the cost of transportation and accommodations for both the employee and a companion. The plan language would also need to be adjusted to reimburse, for example, 125% of the hospitals cost as full and final payment for services rendered. Hospitals that do not accept this payment, as payment in full would be eliminated from the “virtual PPO Network”. This plan design takes advantage of “pure Competition” both locally and nationally and can result in savings of 50% and more on many surgical procedures.

(2). Another solution is to amend the self insured plan document regarding plan reimbursements. Under this solution, the plan allowance for any surgical procedure will not exceed the “best price” that the plan can negotiate at a quality facility anywhere in the U.S. This model creates “pure competition” locally since local providers are offered the opportunity to match the plans best available rate for this procedure. Only hospitals with a HealthGrades rating of 3-5 (five is the highest rating available to hospitals) will be asked to bid for the procedure. If local hospitals will not meet the competition, the employee can either pay the difference or travel, at plan expense to the destination where the services will be covered in full. The plan also covers the cost of travel for both the employee and a companion.

Please contact AMF Risk Management solutions for more information. 617-770-0917 ext. 301.

AMF Risk Management Solutions adds team member Jordan Desrosier to the marketing department of the stop loss insurance underwriting company.

PRLog (Press Release) – Sep 24, 2009 – Jordan Desrosier, a local Quincy resident was recently hired by AMF Risk Management Solutions in order to stimulate direct marketing efforts to Massachusetts employer groups. AMF looks forward to further growth of business with the addition of Jordan's skills and personality in sales and marketing.

Prior to joining AMF Risk Management Solutions, Jordan worked for a variety of marketing companies specializing in the Trade Show and A/V equipment industries. In this position, Jordan was responsible for providing solid leads that translated into successful sales under tight deadlines. Jordan's work ethic and good nature will prove effective in educating Massachusetts' small business owners about more affordable options for their group health insurance coverage.

click here to read the full press release

Health Tip of the Week: September 21, 2009

SUBJECT: Dependent care coverage under employer sponsored Group Medical Plans

Most employers contribute towards the cost of dependent coverage on behalf of their employees. When spouses are eligible for coverage under their employers plan, a decision must be made about which plan(s) to join. Usually the family elects to join the plan which provides the most comprehensive coverage with the least required employee contribution. This election rewards the employer with the lesser coverage and higher employee contribution requirement.

Employers providing the better coverage can protect themselves from the above by amending their plans to prohibit coverage for dependent spouses when they are eligible for coverage from their own employer. Estimated cost savings are the difference between single and family coverage which can be as much as $1,000 per month per employee!!

Visit the website to learn more about savings on dependent coverage.

Hidden Handshakes

According to a recent Boston Globe investigative team article: the CEO of Blue Cross Blue Shield of Massachusetts agreed to give the CEO of Partners Healthcare (Mass General Hospital and Brigham and Women's Hospital) the "biggest insurance payment" since the formation of Partners Healthcare in 1993. In return, Parners Healthcare would push for increases with other insurers while providing the best deal for Blue Cross Blue Shield. The cost increases are then passed along to employers in the form of rate increases!! This same type of arrangement is probably happening nationwide.


Please click here to read the full Boston Globe article

Group Health Insurance - "Aggregate Wrap" product - HSAs / HDHP / Aggregate

AMF Approach to Capitalizing on Savings for High Deductible Health Plans / HSAs

AMF is also offering a high deductible "aggregate wrap" product. In some states, BCBS and other fully insured carriers will offer substantial rate reductions for $2,000 through $10,000 high deductible health plan (HDHP) options. Employers are often intrigued by the cost savings (up to 50% for a $5,000 deductible option) but have concerns about claims administration on the deductible portion and the overall liability.

A high quality Third Party Administrator (TPA) can be hired to administer claim payments on the first $5,000 of deductible expense, according to the employer's wishes. A plan document would be drawn to detail the payment of these "discounted" claims. Claims below $5,000 would have the BCBS or ASO discounts applied before payment is made.

AMF can provide a "cap" on the overall liability of the employer's deductible reimbursement portion of the plan. If the deductible is properly priced by the insurer, AMF may be able to guarantee a maximum cost exposure that will not exceed the cost of the carrier's otherwise fully insured renewal. Our insurance will provide the employer with peace of mind to facilitate the cost savings of a high deductible program, without the liability!!!