David Lindgren, CFC. David Lindgren, CFCI, CSA. Understanding Exchanges: Public vs. Private. Sales Manager Individual & Senior Markets.

Transcription

1 Understanding Exchanges: Public vs. Private April 5, 2013 Page 2 David Lindgren, CFC David Lindgren, CFCI, CSA Sales Manager Sales Manager Individual & Senior Markets 1

2 Who is Flex? Page 3 Located in Rosemont, IL ~100 employees Celebrating 25 th Anniversary in 2013 Core Business Solutions General Agency Benefits Administrator Private Insurance Exchange General Agency Page 4 Insurance wholesaler Work directly with health insurance producers Provide various resources and support services directly to producers only Products Individual Health, Medicare, Ancillary & Supplemental Group Health, Ancillary & Voluntary 2

3 General Agency Page 5 Carriers Benefits Administrator (Flex Plans) Page 6 FSAs Transit Cafeteria Plans HSAs HRAs POPs Defined Contribution Plans COBRA Non Discrimination Testing 3

4 Private Insurance Exchange Page 7 Employers get a simplified employee benefit platform Allows them to cap their costs Streamlines annual benefits buying experience Minimizes typical benefits administration tasks Employees get a personalized insurance buying experience Online individual insurance marketplace Multiple coverage and carrier options Decision support and shopping tools Integrated call center Agenda Page 8 Exchange Overview Public Exchanges Types Availability & Eligibility Subsidies & Tax Credits Private Exchanges Types Availability Summary Q&A 4

5 Poll #1 Page 9 Which of the following best describes your understanding of exchanges? A. I understand them very well B. I understand them somewhat well C. I do not understand them Definition Page 10 What is an exchange? Transaction that occurs between a buyer and seller Organized markets where goods and services are bought and sold More than one good or service is offered 5

6 Definition Page 11 What is an insurance exchange? Place where insurance products can be bought and sold Online markets to shop, compare and enroll in coverage Multiple insurance options offered Insurance Exchanges Page 12 Products vary by exchange Health Medicare Dental Vision Disability Life Other 6

7 Insurance Exchanges Page 13 Features vary by exchange Quoting Enrollment Decision support tools Resources Call centers Insurance Exchanges Page 14 Availability 2 main types of insurance exchanges Public Exchanges Available October 1, 2013 Private Exchanges Available today 7

8 Public Exchanges Page 15 What is a public exchange? Created as part of the Affordable Care Act Insurance exchanges owned and operated by the state and/or federal government Online platforms that provide access to health insurance products only Provide premiums and cost sharing subsidies to eligible individuals Provide small business tax credits to eligible employers Public Exchanges Page 16 3 types Federally facilitated exchange Operated by the federal government State based exchange Operated by the state government State partnership Operated by the federal government States can select plans offered in the exchange States can perform customer service functions 8

9 Public Exchanges Page 17 Public Exchanges Page 18 Who can enroll in a public exchange? Individuals & Families Employers Up to 50 employees in 2014 and 2015 (in most states) Up to 100 employees in employees in

10 Public Exchanges Page 19 Plan Options Expected to be limited Small Employers Deductibles cannot exceed $2,000/$4,000 Limited to one plan option in 2014 (in most states) Individual & Small Employers Out of pocket cannot exceed $6,250/$12,500 Plans will be assigned a designated tier Bronze, Silver, Gold, Platinum Public Exchanges Page 20 Subsidies Available to individuals and families with income levels up to 400% of the federal poverty level Ineligible if employer offers affordable coverage Employee premium cannot exceed 9.5% of W 2 income Premium subsidy Advanced credits to decrease monthly premiums Cost sharing subsidy Credits to decrease out of pocket expenses 10

11 2013 Federal Poverty Limit (FPL) Page 21 Household Size Poverty Level 400% of FPL 1 $11,490 $45,960 2 $15,510 $62,040 3 $19,530 $78,120 4 $23,550 $94,200 5 $27,570 $110,280 6 $31,590 $126,360 Premium Subsidy Page 22 Income Level (Single) Max Monthly Premium Payment $15,281 or Less Medicaid Eligible $15,281 $17,235 $38 $57 $17,235 $22,980 $57 $120 $22,980 $28,725 $120 $198 $28,725 $34,470 $198 $272 $34,470 $45,960 $272 $363 11

12 Cost Sharing Subsidy Page 23 Income Level (Single) Max Out of Pocket Non Eligible Max Out of Pocket Potential Subsidy $15,281 $22,980 $2,083 $6,250 $4,167 $22,980 $34,470 $3,125 $6,250 $3,125 $34,470 $45,960 $4,166 $6,250 $2,083 Small Business Tax Credit Page 24 Eligibility Fewer than 25 employees Average annual wages are less than $50K per full time employee Employer pays at least 50% of premium for employee only coverage Credit Sliding scale that provides up to a 50% credit in

13 The Market for Public Exchanges Page 25 Who is likely to enroll in a public exchange? Individuals qualifying for subsidy assistance Small employers qualifying for tax credits Unknown take right amongst others Commissions Page 26 HHS guidance released in December 2012 Federally Facilitated and State Partnership exchanges Commissions should be comparable to similar health plans sold outside of the public exchange State based exchanges States determine commission structure Online certifications necessary to facilitate public exchange sales Available around July 1,

14 Private Exchanges Page 27 What is a private exchange? Insurance exchanges owned and operated by private entities Insurance companies Insurance brokerages Online platforms that provide access to a variety of insurance products Products vary by private exchange Private Exchanges Page 28 Single carrier exchange Operated by an insurance company Only products from a single carrier included Multiple health insurance options Many include other insurance products 14

15 Private Exchanges Page 29 Multi carrier Exchange Operated by an insurance brokerage Products from multiple carriers included Multiple health insurance options included Many include other insurance products Private Exchanges Page 30 Varying target markets Individual Small employers Large employers Retirees Other 15

16 Private Exchanges Page 31 Varying availability National Regional Statewide Local Private Exchanges Page 32 Subsidies Private exchanges as they exist today cannot provide subsidy assistance Future certification process may allow some private exchanges to administer subsidies 16

17 Private Exchanges Page 33 Employer based exchanges Most incorporate a defined contribution approach Provide employees credits to purchase coverage Outsource enrollment and administrative services to the private exchange Single carrier or multi carrier Offers more choice Private Exchanges Page 34 Booz & Company Survey Employers 80% of employers prefer private vs. public exchanges 50% of employers prefer multi carrier exchange Consumer (employee) desires: Want a guided experience Seek real time administrative support Want a recognizable carrier 17

18 Summary Public Exchanges Government owned Operational in 2014 Available to individuals and small employers Limited plan options Subsidies provided to eligible individuals Funding mechanisms still unclear Private Exchanges Page 35 Privately owned Many operational today Available to individuals and employers of all size More plan options Must be certified to provide subsidies Most utilize defined contribution funding Poll #2 Page 36 Which statement best describes how you anticipate integrating exchanges into your sales portfolio? A. Plan to integrate public exchanges B. Plan to integrate private exchanges C. Plan to integrate both types of exchanges D. Don t plan to integrate any type of exchanges 18

19 Looking Ahead Page 37 Will exchanges become the norm? Public exchanges should see significant enrollment from subsidy eligible individuals Very few small employers receive tax credits today so their enrollment status in public exchanges is questionable Private exchanges are receiving substantial interest and are expected to see growth with increasing availability Contact Us Page 38 General Agency Flex Plans Sales & InsureXSolutions Sales &

20 Stay Informed & Connected Page 39 Upcoming FlexUNIVERSITY Events Apr. 19: A Large Group Concept for Small Businesses (Webinar) Apr. 24: Aetna (Seminar), Rosemont, 2 CEUs May 2: InsureXSolutions: A New Sales Opportunity (Webinar) Gain instant access to the latest industry news, carrier updates, event invites and Flex developments Questions Page 40 20