Healthcare reform bill opens the door to more flexible plan design
If the provisions in the GOP’s health reform bill hold, specifically the removal of the employer mandate, advisers say they expect to see more flexibility in employer-sponsored healthcare and the broker’s ability to help companies create customized benefit plans that are not hampered by essential health benefit requirements.
“Assuming that the provisions in the committee reports are actually voted into law, we would [expect the American Health Care Act] to create a lot of flexibility in the marketplace because it relaxes certain restrictions that insurance carriers have been working with under the ACA,” says Carl Pilger, director of employee benefits compliance services at EPIC Insurance Brokers & Consultants. “In doing away with the employer shared responsibility penalty it alleviates that specter that was forcing employers to offer only certain types of coverage in fear of being penalized for not offering them.”
With no penalties being forced on the employer and better options for the carrier, Pilger expects employers to make their plan offerings more efficient and more cost effective. “[Brokers] will continue to be trusted partners and advisers to employers to make sure they are aware of the latest and greatest of what they can offer,” Pilger says.
For example, removing the employer mandate allows brokers to bring mini med plans back to the table. “Employers will likely be free to offer certain limited benefit plans or minimum coverage plans that would have subjected them to potential ACA penalties,” Pilger says. “Against this backdrop, we see tremendous opportunity for us to leverage internal actuarial and compliance resources, as well as a thorough knowledge of new carrier developments, to be able to present the most sensible, efficient and compliant solution for offering workplace benefits in a post-ACA world.”
As the ACHA goes through Congress, Mark Gaunya, principal at Borislow Insurance, identifies five principles he’d like to see followed to make it a viable alternative to the ACA: affordability; accessibility; high quality care; incentivizing innovation and the empowerment of consumers through transparency.
Also see: “The GOP health plan: What employers need to know.”
Although there is not currently a mandate calling for healthcare cost and quality transparency in the ACHA, Gaunya wants more discussion around the topic and how it can be included into the final product passed by Congress.
“The key to real healthcare reform is transparency of healthcare cost and quality. Health insurance is expensive because healthcare is expensive. Without [transparency], we are just rearranging things and not solving the underlying issue — rising healthcare costs,” Gaunya says. “If we want a consumer-centric healthcare system, the foundational principle of transparency must be put in place to create true competition.”
Rob Thurston, president of HR Consulting Group, Inc. and the Workplace Benefits Association, agrees with Gaunya that transparency is a critical component to have in the ACA replacement. However, he says, enforcing actions that would get the system there, such as peer review and self-evaluation of the medical community, could prove difficult.
A more practical avenue, Thurston says, would be for brokerage firms to continue investing in more data mining options to uncover cost and effectiveness analytics. “I think you’ll see several firms getting into the business of mining Medicaid data and any other data that can show transparency pertaining to cost,” Thurston says.