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May 27. 2012 10:29PM
Reform takes toll on some, aids others
MANCHESTER — For some, the federal health care reform law is like salve on a burn; for others, salt in a wound.
The Patient Protection and Affordable Care Act, enacted in 2010 to ensure millions of uninsured Americans obtained coverage, has brought changes to health care in New Hampshire. Those who have benefited here include 467 previously uninsured adults, 8,330 young adults up to age 26, and children younger than 19 once excluded because of prior illness, officials say. Those who have incurred burdens include businesses that found it necessary to accept bigger deductibles to offset higher premiums.
Christie L. Hager, New England regional director for the federal Department of Health and Human Services, said extension of coverage to age 26 was “a pretty powerful source of expanded coverage” and a big relief for those affected — both young people and their parents. Before the change, young adults could not be covered by their parents' insurance policy after they reached age 22.
The Affordable Care Act also established coverage for a “high-risk pool” of people whose pre-existing conditions made getting coverage impossible or costly. Deputy New Hampshire Insurance Commissioner Alexander K. Feldvebel said New Hampshire initiated the program on July 1, 2010, expanding insurance coverage to sick people who had gone without insurance for at least six months.
New Hampshire received $20 million in federal subsidies at the outset of the program, but because of the large number of “people who were very ill, we've been burning through that funding, and we got authorization for another $33.8 million,” Feldvebel said, “much of which is going to hospitals for services that would otherwise be uncompensated care.”
Rules, rebates
Among other provisions affecting New Hampshire, according to Feldvebel, the law:
- Removed the limit on the amount a patient can collect from an insurer over the lifetime of a policy.
- Removed the limit on the amount a patient can collect in any one year.
- Established a process for independent review of denials of coverage by an insurer.
- Required insurance companies to spend at least 80 percent of the premiums they collect directly on medical care for consumers or on improving the quality of care.
This provision curtails the percentage of premiums an insurance company can apply toward administrative costs or marketing. Under this provision, known as the “medical loss ratio,” insurers who spend less than the 80 percent on care must give rebates to customers. Some customers in New Hampshire will receive rebates this summer, Hager said. Individual plan holders will get an average rebate of $85.23, with a statewide total of $204,718. Large groups will get rebates totaling $39,414 statewide.
Critics abound
Not everyone is enamored of the act. Its constitutionality has been challenged, and the Supreme Court is expected to issue a ruling by the end of June.
Some aspects of the law have come under intense criticism. A medical device tax, for example, will work against innovation, said Jeffrey Carlisle, a Stratham-based entrepreneur.
Carlisle, co-founder of Leveraged Developments as well as Our Health Connector, said: “The real problem is that the sheer complexity of the act creates a high cost and unpredictable environment for investors, so access to capital is greatly diminished by the complexity of the Affordable Care Act.”
Such complexity also burns up resources, he said.
“A massive amount of money is dedicated toward an alphabet soup” of regulations, said Carlisle. “... So the energy of the industry has shifted toward compliance.
“It's possible some of these compliance measures will improve health care, but I think it's unlikely,” he said.
Legacy Financial Solutions Inc. President Stephen N. Mathieu also isn't singing the praises of the act. Faced with a proposed 67.7 percent increase in premiums to keep the same coverage for himself and his small staff, he opted for a much higher deductible to keep premiums within reach.
Bob Benedetto, small-group sales director for Anthem Blue Cross and Blue Shield, said, “That's really what we've seen in terms of the trend, just higher and higher deductible amounts.” Benedetto said small groups have seen their average deductibles rise from between $1,000 and $1,250 in 2010 to $3,000 today.
Mathieu's family plan deductible is now $10,000, up from $4,000, according to copies of bills from Anthem Blue Cross and Blue Shield.
Legacy had to switch to higher deductibles in August 2011. Jean Esslinger, 52, Legacy's vice president, saw her deductible jump from $2,000 to $5,000. The monthly premium for Esslinger, meanwhile, jumped from $449.97 to $729.20 and for Mathieu from $854.68 to $1,458.40.
Since the plan changed, Mathieu, 55, had a heart attack and had to pay $10,000 out of pocket compared with $2,000 a year earlier.
“Just my medications alone are costing me $3,400 more than I would have had to pay under the prior plan,” he said.
Small businesses hurt
The average annual premium for small groups in New Hampshire is $5,858 for single (employee-only) coverage and $14,523 for family coverage, according to the Internal Revenue Service. Small businesses pay on average 18 percent higher premiums than other businesses, said Hager.
To ease some of that burden, the Affordable Care Act is offering a small-business tax credit until 2014. The provision began with a maximum of $7,500 in credits in the first year and will provide up to $12,000 in credits by 2014, Hager said.
Nancy Clark of the Glen Group in North Conway received $1,198 in 2010 and $1,184 in 2011 in tax credits toward premiums, Clark said at a community forum in Manchester in March. IRS spokesman Peggy Riley said the Boston regional office did not yet have records of how many New Hampshire businesses have received tax credits.
But the credits, too, have at least one critic.
“I think the tax credit was a feel-good law with no real positive impact in New Hampshire,” said broker Suzanne French, co-owner of NiBri Benefit Services in Candia.
French said NiBri is ineligible for the credit because all its employees — herself, her husband and their daughter — are related. That family restriction makes many small businesses among NiBri's clients ineligible for the credit, too, she said.
On the Net:
www.healthcare.gov
www.nhfpi.org/research/the-aca-and-new-hampshire.html
Email: dpaiste@unionleader.com
The Patient Protection and Affordable Care Act, enacted in 2010 to ensure millions of uninsured Americans obtained coverage, has brought changes to health care in New Hampshire. Those who have benefited here include 467 previously uninsured adults, 8,330 young adults up to age 26, and children younger than 19 once excluded because of prior illness, officials say. Those who have incurred burdens include businesses that found it necessary to accept bigger deductibles to offset higher premiums.
Christie L. Hager, New England regional director for the federal Department of Health and Human Services, said extension of coverage to age 26 was “a pretty powerful source of expanded coverage” and a big relief for those affected — both young people and their parents. Before the change, young adults could not be covered by their parents' insurance policy after they reached age 22.
The Affordable Care Act also established coverage for a “high-risk pool” of people whose pre-existing conditions made getting coverage impossible or costly. Deputy New Hampshire Insurance Commissioner Alexander K. Feldvebel said New Hampshire initiated the program on July 1, 2010, expanding insurance coverage to sick people who had gone without insurance for at least six months.
New Hampshire received $20 million in federal subsidies at the outset of the program, but because of the large number of “people who were very ill, we've been burning through that funding, and we got authorization for another $33.8 million,” Feldvebel said, “much of which is going to hospitals for services that would otherwise be uncompensated care.”
Rules, rebates
Among other provisions affecting New Hampshire, according to Feldvebel, the law:
- Removed the limit on the amount a patient can collect from an insurer over the lifetime of a policy.
- Removed the limit on the amount a patient can collect in any one year.
- Established a process for independent review of denials of coverage by an insurer.
- Required insurance companies to spend at least 80 percent of the premiums they collect directly on medical care for consumers or on improving the quality of care.
This provision curtails the percentage of premiums an insurance company can apply toward administrative costs or marketing. Under this provision, known as the “medical loss ratio,” insurers who spend less than the 80 percent on care must give rebates to customers. Some customers in New Hampshire will receive rebates this summer, Hager said. Individual plan holders will get an average rebate of $85.23, with a statewide total of $204,718. Large groups will get rebates totaling $39,414 statewide.
Critics abound
Not everyone is enamored of the act. Its constitutionality has been challenged, and the Supreme Court is expected to issue a ruling by the end of June.
Some aspects of the law have come under intense criticism. A medical device tax, for example, will work against innovation, said Jeffrey Carlisle, a Stratham-based entrepreneur.
Carlisle, co-founder of Leveraged Developments as well as Our Health Connector, said: “The real problem is that the sheer complexity of the act creates a high cost and unpredictable environment for investors, so access to capital is greatly diminished by the complexity of the Affordable Care Act.”
Such complexity also burns up resources, he said.
“A massive amount of money is dedicated toward an alphabet soup” of regulations, said Carlisle. “... So the energy of the industry has shifted toward compliance.
“It's possible some of these compliance measures will improve health care, but I think it's unlikely,” he said.
Legacy Financial Solutions Inc. President Stephen N. Mathieu also isn't singing the praises of the act. Faced with a proposed 67.7 percent increase in premiums to keep the same coverage for himself and his small staff, he opted for a much higher deductible to keep premiums within reach.
Bob Benedetto, small-group sales director for Anthem Blue Cross and Blue Shield, said, “That's really what we've seen in terms of the trend, just higher and higher deductible amounts.” Benedetto said small groups have seen their average deductibles rise from between $1,000 and $1,250 in 2010 to $3,000 today.
Mathieu's family plan deductible is now $10,000, up from $4,000, according to copies of bills from Anthem Blue Cross and Blue Shield.
Legacy had to switch to higher deductibles in August 2011. Jean Esslinger, 52, Legacy's vice president, saw her deductible jump from $2,000 to $5,000. The monthly premium for Esslinger, meanwhile, jumped from $449.97 to $729.20 and for Mathieu from $854.68 to $1,458.40.
Since the plan changed, Mathieu, 55, had a heart attack and had to pay $10,000 out of pocket compared with $2,000 a year earlier.
“Just my medications alone are costing me $3,400 more than I would have had to pay under the prior plan,” he said.
Small businesses hurt
The average annual premium for small groups in New Hampshire is $5,858 for single (employee-only) coverage and $14,523 for family coverage, according to the Internal Revenue Service. Small businesses pay on average 18 percent higher premiums than other businesses, said Hager.
To ease some of that burden, the Affordable Care Act is offering a small-business tax credit until 2014. The provision began with a maximum of $7,500 in credits in the first year and will provide up to $12,000 in credits by 2014, Hager said.
Nancy Clark of the Glen Group in North Conway received $1,198 in 2010 and $1,184 in 2011 in tax credits toward premiums, Clark said at a community forum in Manchester in March. IRS spokesman Peggy Riley said the Boston regional office did not yet have records of how many New Hampshire businesses have received tax credits.
But the credits, too, have at least one critic.
“I think the tax credit was a feel-good law with no real positive impact in New Hampshire,” said broker Suzanne French, co-owner of NiBri Benefit Services in Candia.
French said NiBri is ineligible for the credit because all its employees — herself, her husband and their daughter — are related. That family restriction makes many small businesses among NiBri's clients ineligible for the credit, too, she said.
On the Net:
www.healthcare.gov
www.nhfpi.org/research/the-aca-and-new-hampshire.html
Email: dpaiste@unionleader.com
