Founded  in  1979,  BIS  Insurance  Services,  Inc. is an employee benefits insurance  broker  that  provides  customized benefits  programs  to their clients  in  Northern  California.   They  specialize  in  medical, dental, vision,  life  and  disability insurance programs, investment planning, and employee benefit consultative services. Dale Waters and his associates will continue  to  operate  in  their  current  location  under the direction of Norbert  Chung,  Executive  Vice  President  - Western Region of Gallagher Benefit Services, Inc., a subsidiary of Arthur J. Gallagher & Co.

“Over   the  last  25  years,  BIS  Insurance  Services  has  developed  an outstanding  reputation  for  specialized customer service and solid market relationships,” said J. Patrick Gallagher, Jr., Chairman, President and CEO of  Arthur  J.  Gallagher  &  Co.   “Their strong sales culture and western presence will also be a great complement to our employee benefits brokerage operation.   We  are  pleased  to  welcome  Dale  and his associates to our growing Gallagher family of professionals.”

Arthur  J.  Gallagher  & Co., an international insurance brokerage and risk management  services  firm,  is  headquartered  in  Itasca,  Illinois,  has operations  in seven countries and does business in more than 100 countries around the world  through  a  network  of  correspondent  brokers  and consultants.   Gallagher is traded on the New York Stock Exchange under the symbol AJG.

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With responses from 16,485 health plans sponsored by 11,723 employers nationwide who employ nearly 1.9 million people (approximately 4.5 million total lives), the 2007 UBA Health Plan Survey is the nation’s largest and most comprehensive survey of plan design and plan costs.

“With a growth rate of approximately 20% over last year’s previously unprecedented number of respondents, the report defines benchmarks for a greater number of specific industries, regions, and employee size categories than have been available previously,” says Bill Stafford, UBA’s Vice President, Member Services. “The results will be especially valuable to employers in evaluating the effectiveness of their current plans and to knowledgeably make future adjustments while keeping their benefits both competitive and cost-effective.”

The survey report provides vital benchmark statistics on hundreds of health plan factors, including detailed enrollment, plan design, plan cost, employee premium cost-sharing, prescription drug, retiree plan, and flexible spending account norms.

Among the survey’s numerous findings:
• The average annual health plan cost per employee is $6,881 (medical only coverage), with an average employee cost of $3,110 and an average employer cost of $3,771 per employee.
• Average premiums for all plans were $347 for single coverage and $848 for family (a weighted average of all non-single coverages).
• 32.7% of all plans required no employee contributions, and 8.3% required no family contributions. Of plans requiring contributions, employees contributed an average of 26.6% of premium or $90 for single coverage and 46.8% or $385 for family coverage.
• Average premiums increased 7.2% for all plans (after any plan adjustments) versus 8.6% last year.
• Consumer Driven Plans (plans with an HRA or HSA) now represent 8.8% of all plans offered by employers versus 5.8% last year; with 6.0% of all covered employees now enrolled in such plans (notably up from 3.4% last year).
• The average employer contribution to an HRA increased to $1,138 for single and $2,105 for family, while average employer contributions to an HSA were $688 single and $1,089.
• The majority of the increased adoption of Consumer Driven Plans continues to come from employers with under 1,000 employees, with the highest sub-segment being employers with 25-100 employees.

“With employer health plan information reported for over 3,100 cities from virtually every state in the country, differences in plan design and plan costs among various regions and industry groups become quite clear”, says David LoCascio, UBA’s Co-Founder, “This unique level of detail enables UBA Member Firms to provide quantifiable benchmarks to empower their clients to make the most effective decisions possible regarding their health plans.”

As an example, the survey data confirm that the often reported average family health plan premium cost difference for plans in the Northeast (13.8% above the national average) is largely attributable to those plans having richer benefits than any other region of the country. Specifically, 71.0% of plans in the Northeast have no single deductible, and an amazing 82.1% have no in-network coinsurance, versus roughly 30% for plans in other regions.

Other important findings include:
• The median single PPO deductible of $500 remained the same as 2006, as did the in-network and out-of-network coinsurance at 80% and 60%, respectively.
• Both HMOs and CDHPs have approximately 10% lower annual costs per employee than the average plan, while POS and FFS plans have nearly 11% and 50% higher annual costs per employee than the average plan, respectively.
• 49.2% of covered employees also elect dependent coverage, with the highest percentages being covered by FFS and CDHC plans.
• 7.4% of all employers now offer comprehensive, non-insurance company- based wellness programs, mirroring the increasing trend toward consumer empowerment in healthcare.
• 74.9% of all prescription drug plans utilize three copays, with median copays being $10/$25/$50.
• While 18.4% of plans provide coverage for same-sex domestic partners, regional differences are pronounced (53.7% of plans in the West; 22.4% in the Northeast; and an average of 2.1% in the rest of the country).
• Plan premiums increased approximately 0.6% more for employers with fewer than 25 employees than for all other employers.

“The intent of the survey is to provide not only large employers with effective plan benchmarks, but most importantly to provide the 98.8% of employer plan sponsors who have fewer than 1,000 employees with benchmarking data that is critical in managing their programs effectively”, says Stafford. “With an increasing number of employers having operations in multiple locations, a genuinely national survey of this size and scope is the most effective way to deliver that information.”

Copies of the survey are available for purchase via UBA’s website at www.benefits.com. An updated companion report, the 2008 UBA Employer Opinion Survey, which delineates employers’ specific healthcare strategies, cost-containment efforts, opinions, and future expectations regarding their health plans, will be released in the Spring of 2008.

- Simon Hill

- Simon Hill

We will be letting you know of the release of new videos here on the Benefit Insight blog and an archive will be available on our website. Some will also be available through YouTube (www.youtube.com/sacbis) , Google Video and other public sites as we strive to make a contribution to the knowledge base available to the public.

Each video is around 2 minutes long and available in Windows Media format (.wmv) making it easy to watch, regardless of your connection speed. Look for more additions to the series over the coming weeks.

- Simon Hill, Managing Director

“Kaiser Permanente leadership recently made a decision that we will not send out bills for hospital inpatient and other hospital related services that are over six months old for members enrolled in deductible plans. We will not be back billing members for services received prior to 1/1/07. Any additional member responsibility (monies owed for services received prior to 1/1/07) will be waived.

The following hospital related services received prior to 1/1/07, will not be billed:
Inpatient hospital
Outpatient surgery
Lab drawn and processed in the inpatient lab setting
Other hospital related services

For outpatient charges, we will be processing claims and applying any deposits already made by members at the point of service, and adjusting off any balances owed. Example: If the member paid $65 but owes $165, we will write off the remaining $100 member responsibility. ”

This applies to all clients who have one of Kaiser Permanente’s deductible HMO plans in place.

Some people in this industry think that this movie is something to hide from, but I must say that the film was quite different than what I had expected. And while I may not agree with Mr. Moore’s politics, his message pointed out some serious flaws in our medical system: denied claims, many uninsured and politicians in lobbyists pockets. He does a valiant job in the first 35 minutes of doing what he does best…being a muckraker. But then his message gets watered down dramatically as he goes globetrotting to Canada, France and Cuba to show how wonderful their respective health and welfare systems are. One can spin just about anything these days and while it’s easy to find someone in any size group of people who has had a bad experience with our “system” it’s easier to find many MORE people that have been ill that have been treated well and had their issues handled.

One of the vignettes that I found particularly interesting is of this woman that had her insurance claim denied for an ambulance ride to the hospital because it was not pre-approved. Well, this does happen and what do I tell my clients to do? I tell them to call us because this is the type of problem we fix for our clients every day. A quality broker/benefits advisor maintains quality relationships with insurance carriers to get problems solved fast. FYI, between Dale Waters and Vinny Catalano, we sit on most major health insurance carrier broker advisory boards.

Can the system be fixed? Absolutely. Should it be fixed by a single payer healthcare system? Absolutely not, because more bureaucracy will not solve our problems. Our society is based on capitalism and for profit. Modern medicine continues to be redefined by the US in advances in medical devices, drugs, and research. Perhaps it’s time we all take some personal responsibility and focused on understanding our health plans, implementing wellness initiatives, and finding resources that can help you through difficult problems. Let’s find practical ways to insure the uninsured. Let’s find real ways to reduce costs. I’d appreciate any feedback on these thoughts at vinny@benefit-insurance.com

- Vinny Catalano

Aetna has been a constant fixture in both the LA and SF areas and due to the explosive growth in the Central Valley have decided to get aggressive. They recently lowered their rates 21% in HMO and 11% in PPO in order to be competitive. Existing clients will see Aetna quoted along side of other carriers during our Comprehensive Renewal Process that we do every year. Some of the nice features of Aetna are their lower rates on medical when integrating multiple lines of coverage, online medical information and pricing tools and access to alternative forms of care like chiropractic.

Having another quality carrier like Aetna in the Central Valley gives us all more choice and hopefully can keep rates competitive.

They setup a mobile recording booth on the streets of downtown Los Angeles, San Diego, San Francisco and Sacramento, and asked people to “tell us your health insurance story.” Take a look at the Making Of

The resulting “talking heads” are featured in TV ads and on the website www.blueshieldcachatbox.com

Take a look at the short “Making Of…” movie on the site to see how it was done.

“This year’s survey corroborated last year’s key finding that there are far fewer differences in either current or desired services among employers in different industry groups or with differing numbers of employees than was commonly assumed,” said David LoCascio, UBA’s Co-Founder. “The increasing applicability of web-based solutions and the growing sophistication of benefits advisors has leveled the playing field, allowing employers of all sizes to have access to tools and services that were previously available only to large employers.”

There were also striking similarities regarding the items that dominated employers’ wish list for the future, with between 30% to 50% of all employers hoping to add:

* Employee decision support tools (projected employee out-of-pocket
costs for various plans offered, projected total costs for a given
condition, tax implications of FSA or HSA contributions, etc.)

* Formal wellness and disease management programs

* Cost and quality information for hospitals, physicians, and
prescription drugs

* Early-warning tools to identify chronic conditions and potentially
serious claims

* Online enrollment/employee self-service

The adoption of personal health-management strategies by employers of all sizes continues to increase. Roughly 25% of all employers currently provide various wellness and/or health risk assessment programs, and an additional 50% of employers would like to add such programs in the future.

In addition, employers now overwhelmingly believe there should be a difference in benefits and/or costs based on an employee’s involvement in managing any chronic conditions.
“Employer involvement in helping to manage the health of its workforce has been rapidly gaining momentum,” said LoCascio. “The old approach of simply hoping for good claims experience has not worked, and employers are increasingly assuming more responsibility and control in an effort to impact both plan costs and employee productivity.”

Employers are also placing a greater emphasis on educating employees as to the reasons for plan changes and on how they can help improve their health and reduce the cost of their health plans. Survey findings in this
area include:

* 73% of all employers think employees can become better healthcare
consumers if given the tools to do so (provider cost and quality
information, employer-based education on how to manage costs, employee
decision support tools, etc.), significantly more than the 53% who
feel that plan design changes (High Deductible plans, increased
co-insurance, etc.) will make better consumers.

* Employee education initiatives also extend to retirement plans with
more than 50% of all employers now providing employees with in-person
consultations with financial professionals regarding their retirement
savings and investment options.

“Employers of all sizes have seen that proactive health management programs and effective employee communication can have a notable direct impact on plan costs,” said LoCascio. “Employees have a huge vested interest in helping contain costs in order to both stem the erosion in plan benefits and their share of higher premium costs; and most are willing and able to do so if provided the tools and information required.”

The results are based on the responses of 1,746 employers comprising a representative cross-section of companies across all industry groups, various employee size categories, and regions of the country. Copies of the survey are available for purchase via UBA’s website at www.benefits.com.

A companion report, the 2007 UBA Annual Health Plan Survey, will be released later this year. With responses from 13,843 health plans sponsored by more than 9,600 employers nationwide, last year’s 2006 UBA survey was by
far the largest and most comprehensive survey of plan design and plan costs ever conducted. The report provided vital benchmark statistics on hundreds of health plan factors, including detailed enrollment, plan design, plan
cost, employee premium cost-sharing, prescription drug, retiree plan, and flexible spending account norms.