In a recent email from Aetna, Aetna has come forward with a new change for those people that have Aetna or plan on getting it, whether individual or group.  Good news!  Your children who still live with you can also stay on your insurance until they finally marry the neighbor’s kids and get off of your back! We know many families are worried about their dependents losing medical coverage when they graduate from high school or college or otherwise age out of coverage. Health care reform will address this issue nationwide later this year, when new regulations will go into effect. In keeping with the spirit of health care reform, Aetna will work with our customers to extend coverage to their medical plans’ current dependents ahead of schedule. This means current dependents under the age of 26 would not have to leave their plans when they would otherwise age out or are no longer full-time students (including those who would have lost eligibility effective May 31, 2010). Note: that this would not include reinstatement of dependents who previously aged out of their plan. It also does not affect dental, vision, standalone pharmacy or other benefits..

For individual medical plans Aetna will continue coverage effective June 1, 2010 for dependents under age 26 currently covered on a parent’s medical plan. Aetna will not change the plan’s premium until renewal. Regardless of whether a plan makes this change ahead of schedule, health care reform is bringing changes to all plans soon. On the next renewal date on or after September 23, 2010, all medical plans must cover all dependents up to age 26 (and older for plans in states that mandate coverage above age 26). This may include dependents who are not currently enrolled in the plan, in accordance with regulations. We will be able to tell you more when the federal government issues regulations telling insurers and employers how this must be administered. We are pleased to offer our plan members the ability to keep their dependents insured. This is one step toward the goal of health care coverage for all Americans. If you have questions about how this will affect individual members who are interested in making this change ahead of the health care reform law, please contact your Aetna representative as soon as possible.

Individual Health Insurance Quotes

Rate Increase Products

• Individual U65 BlueChoice®,
• BlueSelect®
• Florida Farm Bureau
• BlueOptions® Products
• Large Group
• Small Group
• Individual Under 65
• Medicare
• Group Medicare

If you are a Blue Cross of Florida policy holder, now is  a good time to fill out the quote form above and start shopping health insurance plans!

Here is the agency email received by agents to give us a heads up of the coming news so we can break it to you our trustful clients.

The purpose of this bulletin is to provide you with information on the upcoming rate increase for all Individual Under 65 BlueChoice®, BlueSelect®, Florida Farm Bureau and most BlueOptions® products. (This excludes BlueOptions Temporary
Plans 562-563, all Hospital-Surgical products and GoBlue.) This year’s implementation continues to include the alternate offer process and the transition to the restructured rate environment for impacted members. Carefully review the following
information.

And here are some relative estimations,

Rate Increase Percentage, Effective Date & Implementation: The Office of Insurance Regulation (OIR) approved an 11.2% rate increase for BlueChoice (Underwritten & Guaranteed Issue), BlueOptions (Underwritten and Guaranteed Issue),
BlueSelect and Florida Farm Bureau products. The new rates are effective June 1, 2010 and will be implemented based on the subscriber’s first paid-to date that falls on or after June 1. Approximately 197,000 contracts representing 319,000
members will be impacted by this rate action. The last rate increase experienced by these members occurred June 1, 2009.

How you will find out

Customer Mailings: The first round of rate increase notification packages will be mailed April 13-16, 2010. These notification packages will be mailed using a staggered approach with daily mailings scheduled to continue through the third
quarter of 2010.

Your Choices

Remember, these letters were addressed to us, so these instructions are to agents not to policy holders.

Alternate Product Offer Including Rate Quote

In conjunction with this rate increase we are continuing the Alternate Offer program. This process has been very successful and has enabled us to retain over 95% of customers who contact us. With Alternate Offer, we suggest a
specific lower cost alternate insurance plan to the subscriber and we include the monthly premium that will apply to that subscriber’s coverage if they choose to transfer to the alternate product. This immediately displays to them the
monthly premium savings available.

Monthly Premium Criteria (Underwritten Customers Only)

If the monthly premium for the alternate product is equal to or less than the subscriber’s monthly rate today (pre-rate increase), then the customer will receive a specific Alternate Offer (presuming other criteria are satisfied).

If the monthly premium for the alternate product is more than the subscriber’s monthly rate today (pre-rate increase), the customer will not receive a specific alternate offer. Their letter will contain general verbiage around other lower
cost products that are available and will encourage them to contact us.

The Alternate Offer process was designed and built to support all Individual Under 65 products. There is a variety of different scenarios requiring different letters. All letters have been assigned unique letter codes that appear at the
bottom of each letter.

Depending on which rate increase letter you get, the alternative products are listed below.

A

. BlueChoice with optional maternity if the Alternate Offer is BlueChoice. The suggestion will be to increase their deductible in BlueChoice.
. BlueChoice without optional maternity when the Alternate Offer is BlueOptions.
. Most BlueOptions & BlueSelect Plans (with or without optional maternity).
. Most BlueOptions HSA-compatible plans.
. Florida Farm Bureau (FFB).

D

BlueChoice with optional maternity when the Alternate Offer would be BlueOptions. This letter does not include a specific Alternate Offer because the structure of the optional
maternity benefit available with BlueOptions is entirely different than what is available with BlueChoice. Further, there are two different BlueOptions optional maternity benefits
available with different and separate deductible amounts. Customers are encouraged to contact us for more information.

H

Guaranteed Issue (Choice & Options). There are no alternate products for this population.

The above categories represent the majority of subscribers involved in this rate action.

B

Criteria for alternate offer not met (i.e., the rate for the alternate offer product is higher than their pre-rate increase premium, they changed products within the last 180 days, they were a new sale within the last 180 days, etc.)

C

Current product is a non-HSA plan and the Alternate Offer would be an HSA-compatible plan.

F

. The current product is a non-HSA compatible plan with optional maternity and the alternate offer would be an HSA-compatible plan. This letter does not include a specific Alternate Offer. While enrollees are eligible to transfer into an HSA-compatible plan, optional maternity is not available with the HSA-compatible plans.
. BlueOptions Plans 81 and 98 (with or without optional maternity).
. Highest deductible HSA-compatible Plans with BlueRx Discounts Program

G

BlueOptions MyBasic Plans 82 & 582.

Sample letters are attached for your reference. Where an Alternate Offer is made, the applicable Benefit Authorization
Form and a Business Reply Envelope will be included in the package.

Restructured Rates

Impacted BlueChoice and BlueOptions customers will continue to be transitioned into the restructured rate environment. This transition plan was negotiated with and approved by the OIR. As a reminder, rate restructuring is a required routine
industry practice that insures continued financial integrity and regulatory compliance of our rates. It is revenue neutral to BCBSF. To ensure our rates remain correct, appropriate and consistent, we analyzed the rate relationships between
different benefit plans, different deductibles, different geographic areas, etc., along with structural factors for age, gender, county, etc. This detailed review resulted in the development of restructured rates that brought the entire state into
alignment so that everyone pays a fair and equitable premium for the coverage they maintain. Virtually every rate at every age in every county changed. On Oct. 1, 2006, restructured rates were implemented for all new sales into Individual
BlueOptions and BlueChoice products that occurred on or after that date. All new IU65 products introduced since that date have been developed at the Restructured Rate level.

Members enrolled prior to 10/01/06 are in the non-restructured rate environment. These are the customers who will be impacted by the transition and they will receive the following additional reminder message printed on the reverse of their
rate adjustment notification letter.

NOTICE OF RATE RESTRUCTURE

To ensure you’re receiving health insurance rates that are appropriate, accurate, and fair, our BlueChoice and BlueOptions Individual Under 65 products have undergone a rate restructure. This is a standard industry practice. It ensures your
premiums best reflect the appropriate rates for your age, gender, and county where you live. Rate restructuring is different from rate changes, which are typically rate increases due to rising medical costs, trends, and age. The Office of Insurance
Regulation has approved this rate restructure. The restructured rates will continue to be implemented gradually over the next several years.

Inquiry Support

Product specific toll-free numbers are provided in the rate notification letters. These lines will be staffed by Intermedia, an external vendor that has supported rate increase activities for the Individual Under 65 products for several years and is very familiar with our products, retention practices and all aspects of this initiative.

Rates
Rates will be available on accessBlue by close of business on Wednesday, April 14, 2010.

By the way the quote button above is a reminder that you can still buy health insurance as an individual, which means that this massive website that I built can still be used to find affordable health insurance, until such time as it is replaced by the state health insurance exchange should this actually end up happening.

In my opinion (which is based on the General Accounting Office numbers which probably also qualifies as an opinion), individual health insurance will eventually end, at least in terms of agents, just like it has in Massachusetts. where everyone buys insurance from the exchange.  So again, individual health insurance will still be available, but only in health insurance exchanges where each state is responsible for their own exchange and which companies offer plans through it.

For our current jobs in individual health insurance to stay viable, everyone would need to do as the law intends, which means buying health insurance or getting it through their employer.  The rest of course will either qualify for premium assistance to make up the difference or Medicaid which is slated to expand to cover 35 million more Americans.  In and of itself, this is a fallacy, as the state budgets are already so bankrupt and deficit ridden that they have been cutting benefits and coverage to people that really need it since the recession began.  In fact Arizona just got rid of their CHIP program (health insurance for children) and would have cut even more, had this law not passed which specifically demands that the states not cut any programs nor make it more difficult to qualify for government health insurance programs.

Further, this new health care law is based on the absurd notion that younger and healthier people will  buy health insurance through the health insurance exchange.  This will inevitably not happen because premiums for younger Americans are going to surely become, at least in the short term even more expensive.

This is because the health care legislation will leave insurance companies with no other choice but to raise premiums even higher because for one, this law has provisions that keep premiums for the young and old within a certain ratio.  Secondly, and more importantly, because the young and healthy simply will not ever think about health insurance much less buy it no matter what the law.  Not to mention that health care costs have risen wildly on their own accord just in the time it took you to read this article.

And finally and most importantly, young people and most of the uninsured right now for that matter, will not buy health insurance because the law only penalizes them $695 which is not even significant when compared to what premiums are and what they will become under this law.

“..younger, healthy Americans likely will shoulder premium hikes, at least initially,” said industry lobbyist Kelly Atkinson, executive director of the Utah Health Insurance Association.

Most Americans, probably don’t realize this, but in New York for example if you shop individual plans right now, the cost for an 18 year old male is the same as a 64 year old with diabetes and any other condition you can think of.  And this premium is currently about $1000 per month for both the 18 and 65 year old to get only average benefits.

Under this new law, the only people buying health insurance will be people that have insurance now (though many of them will elect instead to pay the penalty, I know I probably would) and everyone that has been declined.  The rest will head towards Medicaid and to their employer.
The other nail in the proverbial coffin for health insurance brokers is the 80% rule, which simply states that 80% of premium must go to health care costs.  This will eliminate most of the room to pay us even a reasonable commission as brokers after factoring in administrative costs.

Sadly for us this law takes effect as soon as 2011, which will in effect either put us out of business right away or dramatically hurt our bottom line.  What is strange is that the health insurance exchange doesn’t become law until much later, which means that most  health insurance brokers will be forced out due this 80% rule  in the very near term. East Coast Health Insurance as well as some of our competition might be able to stay afloat longer because of the fact that we are larger producers and thus have bargaining strength.

Still, the 80% rule is reasonable and will help stop some of the waste that has polluted our industry, but unfortunately the bulk of the health care cost drivers will still remain, and will eventually poison the entire system with or without health reform.  As one looks at the final bill that passed, I am not only amazed at the new problems that it will cause,  but also and more importantly, it might be very well be the financial death blow to this economy.

A recent study found that administrative expenditures in the United States were four times higher than reported by NHE in 1999, or 31 percent of total health care spending, compared with only 17 percent in the predominantly government-run Canadian system. But this includes Medicare as well, so administrative expenses associated with private insurance could even be higher then 31%!  You do the math.

This article is about the future of individual health insurance brokers, but still I will share my solution.  My solution has no basis in the near term reality of the situation however, and will do nothing to stop the quickening demise of the individual health insurance agency.

But the best bet for our economy is to replace the 2400 page document with a 10 page document that sets up a single payer system while at the same time, leaving people the option to purchase private health insurance much like Europe.  Everybody wins here, and more importantly it makes our health care system become a significantly less important piece of our gdp.  In the end though however maybe in 10 years, that is what this new law will cause because health insurance companies will be unable to make enough money to rationally survive.  I am quite certain that the people who wrote this bill know that as it seems like this bill will cause enough pain to force us into a single payer system.