Health Tip of the Week: October 26, 2009

Hospital Ratings Play Huge Role in Mortality Survey and Study in Quality of Care

Oftentimes in the health care marketplace we hold preconceived notions about where we should go to receive the highest quality of care. According to a Boston Business Journal article, despite the reputation of Massachusetts' health care providers, you may want to think twice about where you go to receive care. Health Grades, Inc., a third party hospital rating company recently released some reports indicating that the overall performance of Massachusetts' hospitals is only so-so in comparison to a national spectrum. Health Grades released a list of the top 50 hospitals in America and Massachusetts did not have a single hospital included on this list.

Health Grades evaluates hospitals on a five-star basis with five stars being a recognition of the overall performance falling in the top 15% of all hospitals nationwide (Harden, Boston Business Journal). "Patients have a 71.6 percent lower risk of dying at a five-star hospital than at a one-star facility" (Harden, Boston Business Journal). With a peek at this difference it is hard to evaluate a provider based on reputation without doing our own research and making an educated decision as a health care consumer.

In terms of the national average of overall performance, "7.9 percent of Massachusetts' hospitals received five-star ratings on overall performance, versus 15 percent nationwide" (Harden, Boston Business Journal). Particularly as a Massachusetts resident, this raises concerns as to what we are really receiving for care versus what we believe we are receiving.

For this particular reason, AMF's domestic medical travel plan "U.S. Health Options" is a smart decision for an employer. Our Customer Care Coordinator bases their decisions about where to send a patient for certain elective surgical procedures on third party assessment, including Health Grades. With the combination of the best possible care, coupled with the cost savings provided, as well as the maintaining of benefits and financial incentives for employees, there is no better time to explore the opportunity of group medical travel plans for self funded employers. The flexibility in the development of the plan is truly tailored to the employer's/group's needs.


email us to learn more - mmckelvey@amfrms.com

Learn more about U.S. Health Options here.

Read full Boston Business Journal Article here.

Health Tip of the Week: October 5, 2009

High Deductible Health Plans - Consumerism Returns to Health Care

There are many benefits to implementing a high deductible health plan today. For employers, fully insured high deductible health plans can help contain the rising rate inflation by reducing premiums when electing a higher deductible than their current fully insured plan. For example, a broker may encourage an employer to move from a $500 deductible to a $1,000 deductible and save around 15-20% on their rates. They may suggest this move in order to reduce the rates for their client to offset the 10-15% rate increase they are receiving on renewal.

A second benefit to implementing a high deductible health plan is the ability to bring awareness of cost to an employer group. By raising the deductible that the employee is responsible for from $500 to $1,000 or $3,000, the employee has more liability in paying out of pocket to satisfy the deductible. As a result many will argue that a high deductible health plan can be the solution in cutting on over utilization that many employers experience by offering a lower deductible. Because the employee is responsible for paying more money than prior year to meet their deductible, the employee is more likely to shop for the best price in health care and is less likely to abuse trips to the emergency room. This will also enable the employer to control the improper use of medical facilities that occurs with a lower deductible.

Many employees do not realize how great the cost of group health insurance truly is for the employer and because it is not their money at hand they are more likely to abuse utilization.

For more information about high deductible health plans' components and how to correctly implement one for a group health insurance plan, please visit this website.

Brokers: How they are doing all they can to NOT benefit you (from a group health broker)

As a group health insurance consumer, you naturally look for an educated adviser to point you in the right direction for decisions regarding health care. As a result, you turn to the internet or the yellow pages to find yourself a qualified benefits broker. You find a benefits broker/consultant with all the right qualifications and a snazzy eye-popping, sophisticated website. What could go wrong?

In this discussion I hope to share some insight to health care consumers why brokers may be doing all they can to not help you. Let me back up by saying that the role of the benefits consultant/broker has changed dramatically since 1995. As a traditional broker, your job in 1995 was quite a bit different. You were working harder to land accounts and you were paid considerably less because the premiums were lower (before the super-inflation period of recent). Today it is quite common to have a fully insured premium renewal increase between 12-15%. As a result, employers are having to reduce their benefits to cut cost or implement a higher deductible to get to the premium level they were at before the renewal. This is no opportunity to reduce cost and avoid disgruntled employees.

There are a number of reasons why the brokers are not interested and will do whatever they can in order to get you to buy into the fully insured premiums with the lower deductibles.

1.) The brokers are paid commissions on the business they put with Blue Cross Blue Shield, or any other fully insured carrier (could be Harvard Pilgrim, Tufts, Aetna, Cigna, United Health Care). They are paid commission on a scale back basis starting at 3% and making its way back down throughout the policy year. The more premium they sell, the larger their commission portion is. By recommending higher deductibles, the premium reduces and they lose commission money.

2.) The brokers are paid "override" commissions on the business at the end of the year. This is where the majority of their money is made. They receive a closing year bonus on their block of business. They are offered two types of bonuses: contingency bonuses and persist-ency bonuses. Contingency bonuses are based on the amount of new business they have with Blue Cross Blue Shield. Each bonus amount is dependent on the individual broker's performance with Blue Cross Blue Shield. The second type of year end bonus is persist-ency bonus. This is for keeping their book of business with Blue Cross Blue Shield and renewing cases with the 12-15% increases. Therefore, the brokers are not motivated to sell employers the cheaper health insurance because they are penalized on their WHOLE block of business if they move cases to a different carrier or self-funded account. I repeat, the ENTIRE book of business they have with Blue Cross Blue Shield so naturally their selection of interest tends to fall with the fully insured carriers.

Brokers have become fat and happy. As a result there is a tarnish to even a title of "broker" and many brokers are swapping their titles to consultant or adviser.

As a result, I would encourage any employer to shop their quote with more than one broker. Let the brokers compete for producing the cheaper health care cost and bring competition back into the equation, true competition!

For more information on our company and our benefit specialists please visit our website.

We are dedicated to finding the affordable solution and keeping YOUR best interest ahead of ours. We value relationship and ethics and that is why our best interest is YOU.

In addition, many brokers will tell you that your company is too small to self fund or self insure. This may be the case; however, it is dependent on many factors besides size of your company such as age and nature of industry.

The brokers will tell you this to keep you fully insured and to keep you buying into the larger premiums, while keeping their pockets deep.

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