BCBSAZ 2016 Individual/Family Plan Renewal

August 27, 2015

bcbsaz logo

This week, Blue Cross Blue Shield of AZ (BCBSAZ) unveiled their new proposed plan and premium information for individuals and families in 2016.

There are many changes, and many customers will be required to take action to avoid losing coverage at the end of the year.  We are prepared to assist these customers with this process as early as September 9th.

Although BCBSAZ will be sending written notification to all affected members in the coming months, we wanted to provide the information in advance to help better prepare these customers for this year’s renewal.

These are the most important changes to know for 2016:

  1. Metal level plans (Platinum, Gold, Silver, Bronze) are considered ACA-compliant plans, since these were plans purchased and effective from January 2014 to now.
  • In 2015, these plans included three networks:  Statewide PPO, Alliance HMO, and Select HMO.   For 2016, BCBSAZ will only offer the two HMO networks in Maricopa County…the Statewide PPO plan is being deleted.   If you have an ACA-compliant plan with the Statewide PPO network, either purchased through the federal marketplace or directly from BCBSAZ, you MUST select a new plan by December 15th to avoid losing coverage on January 1st.  Customers living in all other counties will have access to the Statewide PPO network, as well as another regional network.  Note: the HMO plans do NOT require a primary care physician assignment, NOR do they require a referral to see a specialist.  However, it is important to check the list to make sure desired doctors participate in the network or else they are not covered.
  • The BlueEssential & Copay Complete plans have been deleted, so these customers will need to move to a new plan, as well.
  • For customers on a plan with either the Alliance or Select network, BCBSAZ will automatically enroll in the next closest available plan available for 2016.  This does not preclude you from changing your plan during open enrollment (November 1 – January 31), so contact our office if alternative choices are desired.
  • BCBSAZ ACA-compliant plans experienced an average rate increase of 21.4%.

2.  Grandmothered Plans are those plans purchased and effective between 2010-2013, and will include the word ‘Plus’ in the name of the plan.

  • All of these plans are being renewed without any changes to benefits or to the PPO network.
  • The average rate increase on these plans is 21.2%, however, the new rate will be guaranteed until April 30, 2017.  This will lock in the rates for a full 16 months.
  • Despite the increase, these plans continue to offer greater premium savings over the ACA-compliant plans.  Most customers in these plans will want to keep what they have.
  • Nothing is required to keep these plans, but customers still have the ability to either 1) change the deductible to lower the premium, or 2) consider moving to an ACA-plan during open enrollment (November 1 – January 31) if desired.  If a member moves away from a Grandmothered plan, they cannot get it back later.  We are able to assist with customers with this evaluation.
  • BCBSAZ will be sending a letter to each affected customer on October 12th.

3.  New Dental Plan

  • BCBSAZ is now offering their group BluePreferred Dental plans to individuals and families.
  • Contact our office if interested in private PPO dental coverage from BCBSAZ

We suspect there will be many changes in 2016 from all of our carrier partners.  We know there will be many questions, and we are here to answer them.  Please keep in mind that this is an extremely high-volume time of the year, so time is of the essence…the sooner you take action, the smoother the process will go for you.

Thank you to all 266 of our individual BCBSAZ customers.  We look forward to serving you during this time of change.



Aetna 2015 Plan Updates – Arizona

October 15, 2014

Aetna Logo

In October Aetna will be mailing out letters to members outlining options for 2015 and informing them that some plans are being terminated at the end of 2014.

Most members will be automatically enrolled into a new plan.  But others are being informed that their coverage will be ending December 31, 2014.

This includes pre-ACA plans as well as those who purchased ACA compliant plans both “ON” and “OFF” the exchanges.

In most cases, Aetna will automatically renew members into a 2015 plan. The letter will include information about the plan benefits and premium. If the member likes the new plan, they need to do nothing.

In some situations, Aetna will recommend a plan but will not be able to auto‐enroll the member. These members will need to submit a 2015 application when open enrollment begins on November 15.

Members always have the option to decide not to take the recommended plan, whether Aetna automatically enrolls them or not.

L&A Services will help these members understand their options, including shopping on the public exchange.

HealthNet Update for 2015

October 9, 2014

HealthNet Logo

HealthNet of Arizona, Inc. (HealthNet) is streamlining their Individual & Family Plan HMO portfolio for 2015 with fewer plans.

In 2014, Health Net offered more than one HealthNet CommunityCare HMO health plan in each of the metal tiers: Platinum, Gold, Silver, and Bronze.  We are expecting this to change for 2015.

Automatically, members who enrolled directly with Health Net (i.e., off the marketplace) will be moved to similar plans.  If you like the new plan, you don’t have to do anything to keep it.

However, your agent, L&A Services, Inc. is available to assist you in choosing a new plan for 2015 if you would like to explore your options.

Members who enrolled via the Marketplace are asked to go back to HealthCare.gov during Open Enrollment and actively choose the plan they want for 2015. Don’t forget you need your broker’s name (Benjamin Rosky) and National Producer Number (6747133) to ensure proper service.

Contacting the Marketplace is also necessary for members who qualify for tax credits to get the right amount for 2015.

Member Notifications

90-day plan closure notices to members mailed October 2, 2014.

NOTE:  Regulatory approval is still pending for 2015 plans. Once approved, plan information details will be communicated here.  Until then, Health Net does not have any plan information to release.

Am I getting a check in the mail? Medical Loss Ratio Rebate Update

July 22, 2014

The Affordable Care Act requires insurance companies to spend a certain percentage of the premiums they collect on medical services & programs that directly benefit their insureds. If an insurance company fails to meet this requirement by not spending enough on medical benefits, they must issue a refund to the policyholders during the summer of the following plan year.  This is known as a Medical Loss Ratio Rebate.

These calculations are based on a number of aggregated factors, including the type of plan (small group, large group, or individual) and the state where the plan is set up.

Rebates for the 2013 plan year have already started. Below you will find general rebate information received from the different insurance companies for Arizona policyholders:

Company                                                                   Rebate?
HealthNet                                                                    None
BCBSAZ                                                                        Small Group only
Aetna                                                                            Yes
United HealthCare (Small Group)                           No
Aetna (Small Group)                                               HMO plans only
Assurant Health                                                        Small Group Only
IHC Health Solutions                                              Small Group Only

Individuals and families receiving a rebate may use it as they wish.

Employers, on the other hand, must spend the rebate for the benefit of the plan participants in a fair and equitable manner .  Contact us for recommendations on how to do this properly.

Health Insurance Marketplace Premium Subsidy Calculator

February 11, 2014

Health Insurance Marketplace Premium Subsidy Calculator

If you do not have access to health insurance through an employer and would like to determine if applying for a government subsidy under the Affordable Care Act would help you, this link will enable you to make a quick calculation in order to help decide.

If this calculator results benefit you, please call us for help.  If you are a DIY’er, follow our simple instructions here.

We are pleased to have already helped our clients receive tens of thousands of dollars in subsidies.  We hope you are next!

HealthCare Reform Update – December 2012

December 17, 2012

What Small Business Owners Need to Know

Small Businesses are classified in general as housing up to 50 employees, including self-employed in some states.

•   More than 97% of small business owners will NOT see an increase in the health care taxes they pay under the new law
•   Small Businesses with up to 25 employees & pay under $50,000 in wages are eligible for a tax credit.
•   Those who participate in 2013, qualify for a small business tax credit of 35%, and will see an increase to 50% in 2014.
•   Employers with over 50 full-time employees (see link below) fall into The Employer Responsibility provision.

How do I count the number of full-time employees (FTE)?

•    Getting all of your questions answered now is the role of any smart business owner.  The  U.S. Department of Health & Human Services has provided this guide specifically for the small employer.

The Federal Exchange

On Wednesday November 28, Gov. Jan Brewer announced that Arizona will not create a state-based health exchange but will leave that job to the federal government, as detailed in the Patient Protection and Affordable Care Act.

Citing the lack of clarity and guidelines from the federal government, Gov. Brewer announced   “Without clear federal guidance and instruction, I cannot in good conscience commit the taxpayers of my state to this costly endeavor.”

What does this mean for Arizona?  Information continues to flow from HHS regarding the Exchange requirements, but certainly the flexibility in how the Exchange is set up is now limited.

New Fees

As if insurance carriers didn’t have enough reasons to increase health plan premiums, here are some of the new fees & taxes imposed on plans for 2013 and beyond:

  • Patient-Centered Outcomes Research Fee (also known as the Comparative Effectiveness Fee)

    • This fee is charged to health insurance companies from October 1, 2012 until 2019, and will be used to fund clinical outcomes effectiveness research in an effort to increase the efficiency of medical care.
    • $1/covered life in the plan’s first year that ends on or after October 1, 2012, and before October 1, 2013;
    • $2/covered life for plan/policy years ending on or after October 1, 2013, and before October 1, 2014.
    • Fee subject to adjustment for increases in National Health Expenditures in future years.
  • Health Insurance Tax (HIT)
    • New tax imposed on health insurance companies starting at $8 billion in 2015, and increasing each year.  By 2018, the tax will be $14.3 billion.  The Joint Committee on Taxation estimates that HIT will exceed $100 billion over the next ten years.  Find the AHIP report here on estimated effects on premiums.
  • Federally Facilitated Exchange (FFE)
    • The Department of Health and Human Services recently proposed a ‘user fee’ of 3.5% of premiums for health insurers who want to offer policies in new federal exchanges coming in 2014.  The fee is meant to cover administrative costs of the new markets, which must be self-sustaining by 2015.
  • ‘Cadillac Plan’ Tax
    • Starting January 1, 2018, a 40% excise tax on excess benefits for employers offering high-cost, high-benefit health plans.   These plans are defined as those with premiums exceeding $10,200 for single coverage and $27,500 for family coverage in 2018.

More Taxes:  Attention high-income earners!  Americans subject to the taxes below are individual filers who earn adjustable gross income of more than $200,000 and married couples filing jointly with AGI of more than $250,000:

  • 3.8% on Investment Income
    • Effective January 1, 2013, the new tax will be imposed on unearned net investment income, including capital gains from stock sales, dividend income, bonds, mutual funds, annuities, loans and home sales.
  • 0.9% Medicare Payroll Tax:
    • Also effective January 1, 2013, an additional Medicare payroll tax of 0.9% will be imposed on earnings over the amounts specified above.  There is no additional Medicare payroll tax for employers.

We will provide updates on this and other taxes and fees regulations when they are finalized.

For a current, comprehensive tax overview, enjoy this excellent complimentary e-book put together by BenefitMall, one of our partners.

Regardless of how these new rules apply to you, there is no question change is expected.  L & A Services, Inc prides itself on the valuable guidance provided to every client, and this role grows more & more significant as the American healthcare system evolves.  You have questions; contact L & A Services for answers!

How an employer counts full-time employees for health care reform

December 17, 2012

Many of the Patient Protection and Affordable Care Act regulations apply differently to employers depending upon the number of employees.  For example, the coverage mandate does NOT apply to employers with < 50 full-time equivalents (FTEs).  Recently, guidance has been issued on how an employer is to count the number of full-time employees.  Below please find an unofficial guide* to how the government expects employers to calculate this number.

An Employer Defined:  Generally, “employer” would mean the entity that is the employer of an employee under the common-law test.  All employees of a controlled group under § 414(b) or (c), or an affiliated service group under § 414(m), are to be taken into account in determining whether any member of the controlled group or affiliated service group is an applicable large employer.

Full-Time Employee Defined:  A “full-time employee” is an employee who is employed on average at least 30 hours per week.  130 hours of service in a calendar month would be treated as the monthly equivalent of at least 30 hours of service per week.

An employee’s hours of service would include the following: (1) each hour for which an employee is paid, or entitled to payment, for the performance of duties for the employer; and (2) each hour for which an employee is paid, or entitled to payment by the employer on account of a period of time during which no duties are performed due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty or leave of absence (except that it is contemplated that no more than 160 hours of service would be counted for an employee on account of any single continuous period during which the employee was paid or entitled to payment but performed no duties).

Steps to calculate the number of full-time employees:

•  Total the number of full-time employees (including seasonal workers) for each calendar month in the preceding calendar year;
•  Total the number of full-time equivalents (as defined below) for each calendar month in the preceding calendar year;
•  For each month, add the number of full-time employees and full-time equivalents; and
•  Total the 12 monthly numbers and divide by 12.

Seasonal Exemption

Seasonal employees: a worker who performs labor or services on a seasonal basis, as defined by the Secretary of Labor and retail workers employed exclusively during holiday seasons.

Under PPACA, an employer is not an applicable large employer if:

(1) its workforce exceeds 50 full-time employees for 120 days or less during the calendar year and
(2) the employees in excess of 50 during that period were seasonal workers.

What If There’s a Question of FT Status

Variable hour employees: based on the facts and circumstances at the date the employee begins providing services to the employer (the start date), it cannot be determined that the employee is reasonably expected to work on average at least 30 hours per week.

Measurement Periods – Employers planning to use the Variable Hour Rule must make this decision NOW!

Initial Measurement Period – Between 3 – 12 months generally surrounding an employees’ date of hire during which the full-time determination is made.
Standard Measurement Period – Between 3 – 12 months generally surrounding the plan year during which the full-time determination is made. This is applicable to on-going employees.
Administrative Period – A period not exceeding 90 days, during which the full-time determination is made and the employee is subsequently enrolled if determined to be full-time (working an average of 30 or more hours per week)
Stability Period – The amount of time a Variable Hour employee must be on the health plan.

For calendar year plans, the twelve month Measurement Periods should have already begun.  For example: To be effective January 1, 2014 a standard measurement period = November 15, 2012 to November 14, 2013.

Large Employers (>50 FTE’s) -Shared Responsibility Penalty

•Penalty for not offering health coverage
•If an employer fails to provide its full-time employees (and their dependents) the opportunity to enroll in “minimum essential coverage,” and
•One or more full-time employees enrolls for coverage in an exchange and qualifies for a premium tax credit or cost-sharing reduction, then
•Employer penalty = $2,000 for each of its full-time employees in the workforce in excess of 30.
•This penalty is non-deductible.
•Penalty does not offset the cost of employee coverage.
•Although part-time workers are included in the FTE calculation, large employers are not required to cover part-time employees under the law.

Unaffordable Coverage
•If employer offers its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage, and
•One or more full-time employees enrolls for coverage in an exchange and qualifies for a premium tax credit or cost sharing reduction because:
•The employee’s share of the premium exceed 9.5% of income, or
•The actuarial value of the coverage was less than 60%, then
•Employer penalty = $3,000 for each full-time employee who receives a tax credit or cost-sharing reduction:

When Don’t Penalties Apply
•Employee is in their waiting period AND the waiting period is less than 90 days.
•Variable Hour employee is in their measurement period or worked an average of less than 30 hours per week.


*Courtesy of Ruthann Laswik, Blue Water Benefits