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Q & A with Susan L. Combs: ObamaCare and New Jobs

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We asked Susan L. Combs, President of Combs & Company, a few questions about ObamaCare and new jobs, and wanted to share her responses with you. Here are the questions we asked her, and below are her responses.

How is ObamaCare going to affect new jobs this year? How about new jobs in 2014?

In what ways is the insurance industry going to be affected by ObamaCare? Please share the pros and cons of how it will be affected.

Based on what you know, do you feel that ObamaCare is going to be a success or a failure in the long run?

Here is her response to these questions:

I think you'll see a couple of things, I think you'll see companies that are considered blue collar and creative that have always struggled with offering benefits or not offered them at all look at lowering employee's hours to be under 30. I think you'll also see some companies just giving their employees a flat dollar amount in their paycheck to go out and buy coverage on their own and stop dealing with the administration of it all.

One of the things that could have a negative impact is that the population in general reads snippets of things here and there and doesn't really get a good education with what is truly going on, so even though the penalties are delayed for another year Federally, and only affects companies with more than 50 Full Time Equivalent (FTE), people will assume that the 30 hours affects everyone and may unnecessarily downgrade hours for employees that don't "need" to be.

Each state currently is very different when it comes to how their health insurance is setup, 42 states currently require medical underwriting for determining rates and in 2014, that is all going away. In New York, we are already community rated and guaranteed issued so we are still anticipating increases come 2014 but not like the 42 states that are going to drastically have to change how they have been doing business. For example, some states you have to elect maternity coverage or mental health might not be covered and they can offer exclusions for Pre-Existing Conditions, in 2014 all these will be covered as part of the Essential Benefits. In addition to these examples, all Preventative Care is covered at 100% without cost-sharing now (no copay or deductible) and all these things that are no longer costing the consumer money, still costs money and hast to get paid for in some way; this typically will translate to premium dollars being higher.

A couple things to keep in mind:
  1. Be looking for "Neighborhood-centric" plans, meaning that carriers are going to come out with plans that limit the network dramatically in order to get the cost down. A great example of this has been with Aetna's NYC Community Plan in NYC, these plans have typically been under $400 a month in premium but they are an HMO plan where you must get a referral and they only have doctors in the 5 Boroughs. The smaller NYC Community Network they are utilizing is about 40% of the size of the normal Aetna Network. So be looking for these type of plans to be coming out In and Out of the Exchange / Marketplace. Another example of this is that in the state of NY the carrier list for the Exchange / Marketplace have come out and there are a list of 20 carriers, 5 of which have the name Blue Cross and/or Blue Shield in the name. This means that there will be 5 different networks of the "Blues" to choose from depending on the area you live.

  2. Brokers will be allowed to sell inside and outside of the exchange and there will be no difference in cost. Be wary of signing up through a Navigator because as it stands right now, they are going to be glorified Enrollers that since they are not licensed, they cannot advise on Insurance, they can only present to you the plans and have you draw your own conclusions. Also, 6 months down the road if you have a question about the benefits you bought or you are having a claims issue, you cannot go back to the Navigator, you'll be dealing with the carrier directly and not have someone as your advocate as you would if you had got your plan through a Licensed Broker that is more qualified to help assist you with your needs.

  3. Be on the lookout as groups to be getting hit with more taxes on your group plans, this is going to help to pay for the cost reduction for the Individual Plans.

There are 3 pillars of healthcare, you have the cost, the quality and the accessibility. I think this bill has done a great job making it accessible for more Americans to take part in plans but if you do not address the cost and the quality - the 2 factors that make prices go up, I fear that we are in for bigger increases than we have ever seen before. The penalties for not having insurance are very low and now they have been delayed for another years. Think about what you want for the Constitutionality of mandating insurance, just from a sheer risk standpoint, if it is not mandated, it will not be a well-balanced risk pool. You need the healthy 25-year-olds in with the high utilizing 60-year-olds to balance out the risk.