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Issue: # 15 April 1, 2008
78 pleasant
Greetings!
 
Keeping you informed of the latest developments in the employee benefit marketplace. 
If you have any questions, e-mail Bill or Vanessa.  To learn more about Advantage Benefits, click here.     Many of our clients have found these newsletters to be quite helpful and we have now set up a link to hold all the archived newsletters on-line that can be accessed at anytime. 
 
If you know anyone, who may find this information of interest, please forward them this newsletter (there is a link on the bottom), and they can subscribe themselves.  
 
Sincerely,
 

Bill Randell, CLU, CHFC             Vanessa Costa, CLU,CHFC
Advantage Benefits Group, Inc. 
Advantage Benefits Renewal - Revised
Health Savings Account

Although our plan was to renew the Premier Value from Blue Cross, we decided to implement the new HSA High Deductible Plan.  Since the trend continues to increase co-payments & deductibles, we decided to take the plunge.  The premium savings is not material, but this will give us a better, first hand, understanding of the process, and will better prepare us to offer these programs to our clients.

Plan Name:                                               Single Rate:              Family Rate:
HMO Blue Premier Value - Renewal               $  353.98               $  928.49
 
Office Visits:                      $ 25                           
Emergency:                       $ 100
Day Surgery:                     $  250                         
New Imaging Co-Pay:         $  75
Hospital:                            $1,000 deductible        
RX:                                   15/30/50

The family premium is $854.78 per month. This generates a $73.71 monthly savings, or annual savings of $ 884.52, per family plan.  Since there are only family plans in our office, each can deposit up to $5,800 into a Health Savings Account (HSA) on a tax deductible & tax-deferred basis. The family deductible is $3,000, which is the out-of-pocket expense in a plan year before co-payments begin. 
 
If employees incur the $3,000 of expenses, it can be deducted from the HSA without any tax consequences. Conversely, monies not spent may accumulate. Families may then make another tax deductible contribution next year, and  then consider an even higher deductible to keep the premiums as low as possible.
 
Lastly, keep in mind,  there is NO "loss" of monies in an HSA, if you do not "use" them unlike an FSA (Flexible Spending Account) .   Monies remaining in the HSA accumulate tax-deferred and can be withdrawn but will be taxed, if they are not used for un-reimbursed medical expenses.   Please note similar to an IRA, you pay taxes on these monies as they are withdrawn including a 10% penalty before age 59 1/2.     
 
 
TrustMark
Be Careful!
 
As brokers, we constantly watch for products that may benefit our clients.   At the same time, we will only sell products we are comfortable representing.  Recently, our attention has been drawn to a company called Trustmark.   Although we can sell this product, after an extensive review, it is not a program that we would recommend to our clients.  It appears to be the latest scam on the street to let other people in the door with hopes of saving money.  Here are the issues that merit concern:
  1. Individual underwriting.  Every employee needs to complete a 6 page employee application.   In other words, you may be presented one rate, but after all the employee enrollment applications are reviewed, only then is a final rate given - which, more often than not, increases due to medical history of employees. 
  2. Pre-existing conditions exclusion.  New employees, who do not have "credible coverage" and current unenrolled employees are subject to pre-existing condition exclusions.
  3. State mandates are not followed.  The State of Massachusetts will allow a carrier to bypass certain state mandated features in their PPO health plan if they do not offer an HMO product.  This means that certain types of coverage - like invitrofertilization and mental health benefits may not be covered.  This means the carrier may offer a lower premium due to the fact that benefits may be "stripped down" compared to Tufts, Fallon, Harvard and Blue Cross.  
  4. Track history.  NONE
So, please be cautious if presented this product!
CommonwealthCare Renewal 
Updated Rates
 
The Massachusetts Health Insurance Connector Authority voted to pass a 10% increase in premiums,( This is less then the 15% the participating health insurance plans had requested).   Under the new contract, the Commonwealth, however, will assume more of the financial risk, if utilization is higher then expected.  Story from the Medical News Today.
 
TRANSLATION.  The rates should have gone up 15%, but the insurance companies were pressured to only increase the rates 10%.  The utilization will be higher then expected and the Commonwealth (you and me) will have to assume the "financial risk." 
 
This is simply not working.  Latest news is that the "financial risk" is in the 100 million range, which means more like 125 million.  Where are we going to come up with this money?  
 
ANSWER.  One dollar per pack increase in the cigarette tax.   This simply will not work either.   Border stores will have their cigarette business destroyed, not to mention other lost sales and tax revenues, when customers cross state borders to buy their cigarettes.  In the end, a dollar per pack increase in cigarette tax will not only not increase tax revenues, but will hurt them.