New Orleans Association of Health Underwriters

 I N   T H I S   I S S U E...

*  January Meeting
*  NOAHU Delegation Going to DC
*  Be Recognized! Leading Producers 
   Round Table
*  HSA Changes Signed Into Law
*  www.nahu.org - A Wealth of Info At
   Your Fingers
*  2007 Chapter Sponsorship Program
*  How US Is Dealing With The Uninsured

NOAHU Delegation Going to DC

President Kenny Collins, Vice-President Jennifer Toups and Education Chair Carmen Waring will represent  the New Orleans chapter at the NAHU Capitol Conference in Washington, D.C. January 29-31, 2007.  Local member Denny Ebersole, who serves as the NAHU Region 6 Vice-President will also attend.

At Capitol Conference, attendees hear from many high-ranking political leaders on various aspects of the health insurance industry.  In addition, we visit with each Senator & Representative and/or their staff to present the issues that NAHU is concerned about.

The change in the political landscape makes this Capitol Conference more important than ever.  The key issues we will speak with leaders about are Reauthorization of the State Children’s Health Insurance Program, Health Insurance Technology & Transparency, Medicare & Prescription Costs, Long Term Care, the Patients Bill of Rights and Mental Health Parity.  For more info on our federal legislative priorities, click here.

As a HUPAC fundraising event, attendees can attend a reception with former Speaker of the House and presidential hopeful Newt Gingrich.  A member of Bush’s staff will talk about the Administration’s health care priorities and their will be a health care debate with Congressional staffers.  In addition, we are thrilled that Representative Bobby Jindal has been invited to present at the conference on certain health care issues.   

Check back in next month’s issue for a recap of the event, news from DC, pictures & more!

Be Recognized! 2007 NAHU Leading Producers Round Table

It’s the new  year & it’s time to apply for membership in the Leading Producers Round Table.  This is NAHU’s top honor for sales achievement.  Applying is easy!  Click the links below for the application & requirements.  Be recognized!

2007 Application & Instructions

Qualification Information

  o        Personal Production: Business written by a single producer

  o        Carrier Representatives: An employee of an insurance carrier working with producers

  o        Agency: Management of a general agency or agency

  o        Carrier Management: Carrier/home-office sales managers, directors of sales and vice presidents of sales

Levels of Membership

  o        Qualifying :This category is available to members applying for the first 9 consecutive years of qualification OR for the first 14 total years.

  o        Lifetime: This category is available to members applying and qualifying for 10+ consecutive years OR for 15+ total years for members who are no longer producing.

  o        Lifetime & Qualifying:  This category is available to members who still generate production at qualifying level and have achieved lifetime membership.

Awards Categories

  o        Leading Producer Qualifier

  o        Presidents’ Council

  o        Eagle

  o        Golden Eagle

     Please see the application on the NAHU Website for fullqualification guidelines.

Benefits

• Web Seminars: The Leading Producers Round Table sponsors several Web seminars each year. The Web seminars will deal with advanced topics that are of interest to the top producers in the industry. The seminars will be open to the general public, but LPRT qualifiers will be able to attend these Web seminars free of charge.
• LPRT Educational Track at the NAHU Annual Convention  There will be an LPRT-focused educational track at the NAHU Annual Convention. This educational track, like the LPRT Web seminars, will deal with advanced topics.
• LPRT Qualifier Discounts A 5% discount on all NAHU services and meetings, including Capitol Conference and the Annual  Convention, will be given to qualifiers at the Leading Producers and Presidents’ Council levels of production.   A 10% discount on all NAHU services and meetings, including Capitol Conference and the Annual Convention, will be given to qualifiers at the Eagle and Golden Eagle levels of production and Lifetime qualifiers.
• LPRT Products The Leading Producers Round Table will offer LPRT logo merchandise.
• Recognition  The Leading Producers Round Table recognizes qualifiers in myriad ways for their outstanding   achievements.  LPRT qualifiers receive a certificate with their name and level of qualification each year  until they attain Lifetime status. Lifetime qualifiers receive a lifetime achievement plaque. Additionally, Golden Eagle qualifiers receive an eagle statue. Qualifiers also receive an LPRT pin, which is usually presented at local or regional leadership conferences.

History

NAHU formed the Leading Producers Round Table in 1942 to recognize the successful underwriters of accident and health insurance. Today, the LPRT Committee is committed to making LPRT the premier program for top health, disability, long-term care and worksite marketing insurance producers, carrier representatives, carrier management, and general agency/agency managers. Through the hard work of the LPRT Committee members, LPRT will offer new membership benefits, exclusive LPRT events, and new categories and qualification requirements.

New HSA Changes Signed Into Law

During the last moments of the 109^th Congress, the Tax Relief and Health Care Act of 2006 was approved, and is expected to be signed by the president.  This legislation extended certain tax provisions, made changes to Medicaid and Medicare, and made a number of changes to improve Health Savings Accounts and make them more accessible. 

NAHU worked very hard to get these changes made before the end of the 109^th Congress.  In addition to direct lobbying of members of Congress by both our members and staff lobbyists regarding these issues, NAHU gave written testimony to the Senate Finance Committee and the House Ways and Means Committee last fall.  One of our members, Eric Biettel of Pennsylvania, was invited in September 2006 to testify before the Senate Finance Committee to urge Congress to make these improvements. 

The NAHU Staff has prepared a quick overview highlighting the new changes.  Keep in mind that that some of the provisions need to be clarified and guidance should be issued soon.  We will continue to keep you updated and plan to have an upcoming meeting dedicated to these new rules.

Projected Medicare Part D Costs Drop By 30 Percent

Independent estimates for the Medicare Part D prescription drug benefit for the FY 2008 budget cycle show that net Medicare costs are 30 percent less -- $189 billion lower -- than were originally predicted when the benefit was created in 2003, HHS Secretary Mike Leavitt announced today. In addition, based on strong, competitive bids by health care plans for 2007, average monthly premiums will be approximately $22 for beneficiaries, down from $23 in 2006, if enrollees remain in their current plans. The initial estimate for 2006 premiums was $37.

"Our new estimates provide clear evidence that consumer choice is working," Secretary Leavitt said. "Government interference will result in fewer choices and less consumer satisfaction. Actuaries have told us that government interference will not lead to lower drug prices either."

According to actuaries with the Centers for Medicare & Medicaid Services (CMS), the updated Medicare Part D baseline of payments to Part D plans for the FY 2008 budget cycle has decreased from last summer’s mid-session review numbers by $113 billion over the next ten years (2007 - 2016). Importantly, of the $113 billion reduction, $96 billion is a direct result of competition and significantly lower Part D bids.

"Part D drug plans produced greater-than-expected savings by competing for Medicare beneficiaries and aggressively negotiating with drug companies," said Acting CMS Administrator Leslie V. Norwalk. "Strong, competitive bids and informed beneficiary choices are bringing down premiums yet again. The bottom line from the news today is that beneficiaries are paying less in premiums and taxpayers are seeing billions of dollars in savings."

In addition to the $96 billion reduction -- due to substantially reducing their bids in 2007 in an effort to compete with rival plans -- there are two other factors that lowered the estimated cost of Part D payments to plans: lower growth in drug costs in general, and lower enrollment than originally expected.

Lower actual growth in drug costs in 2005, compared to last summer’s mid-session review estimates, resulted in an approximate $13 billion reduction in the new baseline. The reduced Part D cost estimates reflect lower actual growth in drug costs than had been expected, with a single-digit percentage increase (5 percent in 2005) observed for only the second time in more than a decade. Relatively slow growth in actual drug prices and costs, compared to past trends, is expected to persist over the next few years, as more generic drugs become available and aggressive steps to keep down drug costs continue.

Lower-than-anticipated enrollment in Part D reduced the new Medicare Part D payments to Part D plans by $20 billion when compared to last summer’s mid-session review figures. As the CMS actuaries discovered, many Medicare beneficiaries had creditable prescription drug coverage from other sources (such as FEHB, Tricare, and the VA), and did not need to sign up for what would have been duplicative coverage under Part D.

The new baseline numbers also reflect an increase of $16 billion due to updated figures from the 2002 to the 2003 Medicare Current Beneficiary Survey.

"In addition to this huge savings as a result of drug plan competition, it is important to note that beneficiaries are saving more as well by overwhelmingly selecting less-costly drug plans for themselves," said Norwalk. "The average monthly Part D premium in 2006 for the standard benefit package would have been about $32 if beneficiaries had enrolled in plans randomly, without a preference for the lower-cost, lower-premium plans. Instead, enrollees actually paid premiums that averaged about $23 in 2006, reflecting their choice of more efficient plans with lower premiums." The actuaries note that this pattern is expected to occur again in 2007, as beneficiaries opt for the best bargains among competing plans, and should further lower the average monthly premium.

How Is The US Dealing With A Rising Number Of Uninsureds?

In 2006, we witnessed how different municipalities and states in the U.S. coped with the rising trend in the uninsured American population. 

Nationally, this included the enactment of only a few laws regarding the increasing of coverage to uninsureds.  Most of the controversial measures even rolled from the chopping board, falling prey to court disputes, not to mention vetoes from state government leaders.

Massachusetts made history last April when it signed its health care legislation into law, essentially becoming the first state ever to provide mass statewide health coverage through subsidies for low-income earners. Though there were some points of disagreement between lawmakers and Massachusetts Governor Romney over the final version of the passed bill, the law drew plenty enough raves from all sides of the fence. 

The law likewise mandates citizens who can afford insurance – by July 1, 2007 – to get health coverage, or else face the risk of paying higher state income taxes. 

Similar health care laws like the ones enacted in Tennessee and Vermont, used a minimalist approach to health reform.

Tennessee’s law provides low-income employees employed by small businesses (those with only 25 or less employees) single coverage at one-third of the total health insurance premium rate sponsored by the state.  This translates to approximately $150 monthly.

On the other hand, Vermont's law enables a new, wider coverage, state-subsidized insurance premiums – developed by commercial insurers for low-income residents.

Vermont will subsidize these premiums by requiring small companies (9 or more employees) who don’t provide employee health insurance to pay the state a fee of $365 per year for each worker they employ.   Revenues from cigarette tax increases would also be sources of revenues for subsidizing these insurance premiums. 

In Maryland, the fate of the Fair Share for Health Care Act still hangs in the balance as of the close of 2006, even after their state legislature that year overrode the veto given by Governor Robert Ehrlich in the last quarter of 2005.

Controversy in storm-like proportions has swept across the nation, with labor union groups and the Wal-Mart organization right smack at the center of the storm’s eye.

In contrast, Maryland’s Fair Share Health Care Act – if passed – would compel large businesses (those with more than 10,000 workers) to shoulder up to eight percent of health care costs for their employees, or risk paying the state any shortfalls.

Legislation of the same color and context were previously passed in two-dozen states, setting the stage for the drafting of a single encompassing federal-level law.  Lawmakers now in the other states appear to be inclined to vote for a Fair Share type of law, triggering the forging of alliances from both sides of the fence.

Below are some hard facts:

• To date, only 60 percent of working-age Americans were provided health coverage by their employer (Compared to the 69 percent of Americans with health coverage in 2000).
• Seventy-five million Americans are underinsured.
• Forty-five million don’t have any kind of health insurance at all.
• Of the 45 million uninsured, about 80 percent are employed or live in working families.  

The majority of large U.S. businesses, during the past 50 years, provided their employees with health coverage. But in the case of Wal-Mart, only 48 percent out of its 1.3 million work force in the United States are covered by the company’s health insurance plan. Furthermore, 27 percent of employees’ children are SCHIP or Medicaid-enrolled, and an additional 19 percent are wholly uninsured.  Nationally, companies providing insurance remit $31 billion a year to insure the employees of other companies, while states are paying $8 billion to insure low-wage workers.

Now, companies are starting to grasp the importance of the Fair Share act. 

At present, the law’s enactment depends on whatever ruling will be passed on the appeal filed by Maryland's attorney general challenging a federal court’s decision last July 2006, indicating that the law violated the Employee Retirement Income Security Act.  Once enacted, starting January of 2007, the law would demand that company owners with 10,000 or more employees spend a minimum of 8% for employee health benefits.

Last summer, in San Francisco, the Golden Gate Restaurant Association filed an ERISA challenge against a city ordinance requiring companies with 50 or more employees to pay a fee for each hour that an employee works into a fund to be used to cover the cost of their health care.  This ordinance was originally slated to take effect July 1, 2007.

In Chicago, a so-called "big box" ordinance, which would have required retailers with at least 90,000 square feet of space in a single location to pay their employees at least $10 an hour and provide another $3 an hour in benefits by 2010 was also vetoed Chicago Mayor Richard M. Daley.

Lastly, in California, Gov. Arnold Schwarzenegger struck down two pieces of legislation: a more radical measure that would have created a single-payer system, and a bill similar to the Fair Share act.  Gov. Schwarzenegger, however, proposed to work together with California lawmakers in delivering a more appropriate healthcare measure and is set to unveil his health care plan this Jan. 9, 2007.