Column 66

Fall is the insurance and benefits season, even more so than in the past. There are multiple open enrollment periods starting in the fall with  their own set of rules. 

Medicare Part D Rx open enrollment runs from 10/15 to 12/7.  This is the prescription drug program for all eligible Medicare beneficiaries.  It is critical that folks understand that these plans can change dramatically.  Folks will tell us that they like the plan they have and it works for them, only to find that the insurer changed the formulary and now their drugs are not covered in the same way.

The Medicare website has a terrific tool for evaluating these plans.  Granted, we are all one doctor visit away from a new medication, but this report is the best way I know to evaluate the plans.  You can re-run the report to show the cost at different pharmacies and mail order to see the lowest cost option for you. 

We have found dramatic differences depending on the particular Rx list and the pharmacy.  If you do not have internet access you can go to the library or make an appointment at HICAP at 223-0999.  You may enroll online, or if you wish to have assistance after enrollment, I recommend that you enroll through a qualified broker or agent.  

Open enrollment for the individual market, including the California health exchange: Covered California is November 15, 2014 to February 15, 2015.  Note for coverage to be effective 1/1, applications must be submitted before 12/15/2014.

The National Association of Health Underwriters (NAHU) published the 2015 rules.  

  • Consumers who do not denote otherwise will be re-enrolled in their current exchange plan on December 15, 2014, rather than right away. NAHU asked for a time-delay in re-enrollment in order to give consumers ample opportunity to review their plan options.
  • Those who are re-enrolled will be able to keep their 2014 subsidy as long as their income has not changed dramatically and if they checked the box on their original application that allowed the IRS to view their tax returns (a reported 90% of consumers checked the box).
  • If a consumer is enrolled in a plan that has been cancelled on the exchange, but offered outside of the exchange, they'll be automatically enrolled in the plan off the exchange. (This could be problematic if the insured is expecting a subsidy to offset premium, so be very careful!)
  • If the plan has been cancelled altogether, the consumer will be enrolled in a plan of the same metal tier. If a similar tiered plan is not available, they will be automatically enrolled in a different plan of the same carrier and metal tier. If the carrier does not offer a different plan of the metal tier the consumer was previously enrolled in, the consumer will be enrolled in a plan one metal tier higher or one metal tier lower that they were previously enrolled in. If that still is not an option, then the consumer will be enrolled in "any other plan offered under the product in which the enrollee's current QHP is offered in which the enrollee is eligible to enroll." If that didn't sound confusing and complicated to you, then you are nominated to be in charge of the exchanges!
  • If plan premiums go up, (about 4-6% this year), the consumers who are automatically re-enrolled will be on the hook for the price of the premium increase.

The issue of consumers getting larger subsidies than they deserve still remains to be an issue and an industry-wide concern. I expect this year's tax season is going to be very interesting for tax professionals as well as those that received a subsidy.

Many small group insurance plans "early renewed" for 12/1/2014 will be receiving their renewal actions by October 1st.  They will need to decide if they will grandmother their plans, or roll to plans that conform with the ACA (Affordable Care Act).  Typically open enrollment is the month before the effective date, so groups must make their decisions and prepare their packets by early in November.

Large groups are typically facing open enrollment in the fall for at 1/1 effective date.  Employees will want to know what the options look like in order to determine if they want to insure their dependents on the group plan or not.  In the past, the issue was insurability as well as rate for the dependent. But now, that individual plans are guaranteed issue, rates and benefits are the issue.

Note: All information in this column is provided" to the best of my knowledge" subject to final regulation by the respective agencies.