On January 24, 2013, the Department of Labor (DOL) announced that it would delay the compliance date for the delivery of employer-provided Exchange Option Notices required to be distributed to employees beginning March 1, 2013.

As part of health care reform, the Affordable Care Act (ACA) amended the Fair Labor Standards Act to require employers to provide employees (including newly hired employees) with information about health care Exchanges and ways in which individuals can qualify for federal subsidies to purchase health care coverage through an Exchange.

Originally, the Notice of Exchange Coverage Options was to be delivered to employees beginning March 1, 2013. The ACA requires the DOL to create and release a Model Exchange Notice for employers to use, but to date no model language has been released. This is due, in part, to the fact that many States have not yet decided if or how they will create an Exchange and no information is available about the Federal Exchange program. In the present guidance, the DOL anticipates that the Notices will not be required to be distributed until late Summer or early Fall of 2013, probably in coordination with the open enrollment period for the Exchanges.

When the Notices are required to be distributed, they must include specific information, including the following:

• Information regarding the existence of a particular Exchange available to an employee (either the applicable State Exchange or the Federal Exchange) along with a description of services and policies being offered by that Exchange and information on how to contact each Exchange to request information and assistance.
• Information regarding how an employee can determine if he or she is eligible for a premium tax credit or a cost-sharing reduction through an applicable Exchange.
• Information explaining to employees that if they purchase a qualified health plan through the Exchange they may lose any employer contribution toward the cost of employer-provided coverage and that all or a portion of such contribution may be excludable from income for Federal income tax purposes.

MedBen clients with questions regarding this Notice requirement may contact Vice President of Compliance Caroline Fraker at 800-851-0907.

Concerned that governmental decree of what constitutes “essential” health care benefits could overburden small-group and individual insurance plans, a coalition of business groups, health plans and health care providers has asked the Department of Health and Human Services to keep the final list affordable.

Modern Healthcare reports that The Essential Health Benefits Coalition, whose membership includes the National Retail Federation, the U.S. Chamber of Commerce, America’s Health Insurance Plans, the American Osteopathic Association and the Pharmacy Care Management Association, submitted a list last month of six recommendations to HHS to help keep the cost of coverage within the means of the nation’s small businesses.

“We think the administration in its final rule should focus on allowing more private-sector strategies to achieve greater benefit value and affordability and again avoid including benefits that are not commonly offered today,” said coalition chairman Neil Trautwein. “If they’re not commonly offered today, there’s a reason and a rationale why they’re not offered.”

Trautwein, who serves as vice president and employee benefits policy counsel at the National Retail Federation, added that of particular concern to the coalition is the potential inclusion of state-mandated benefits in essential health benefit benchmark plans. Often such mandates lack strong medical evidence and needlessly increase coverage costs, he said.

On the KevinMD.com blog, Dr. Davis Lui says there is more to the family doctor than meets the eye… and the numbers agree:

“If you view your primary care doctor as a person to simply get referrals from to get better care, think again.

“One health insurance plan focused on having patients see primary care doctors first to help them figure out how to proceed. Without primary care doctors helping patients, 60 percent of the time patients chose the wrong specialist. Selecting the wrong doctor wasn’t the only issue. On average, $1,500 was spent on various tests and diagnostic services visits over an eleven-month period before patients were told that the specialist could not help them. Result? Wasted time and money. By pairing patients with primary care doctors, the use of specialists fell by 14 percent, emergency room use decreased by 16 percent, prescriptions declined by 11 percent, and patients received the right care. Less time and money wasted.”

MedBen Worksite Wellness also believes in putting the family doctor first. Many wellness programs bring in outsiders to check your employees’ vital statistics and hand out health assessments. But afterward, employers still aren’t certain if employees have received essential care or if progress was made.

MedBen emphasizes physician office testing that keeps the primary care provider involved and eliminates the logistical headaches and potential redundancy of on-site screenings. And our progress reports and online services help members keep on top of their testing.

For additional information about MedBen Worksite Wellness, please call Vice President of Sales and Marketing Brian Fargus at (888) 627-8683.

As more Americans have grown comfortable sharing personal information over the Internet, the medical profession is testing the waters a bit. Some physician’s offices now offer “e-visits", in which patients complete online forms and a doctor or nurse respond with treatment advice.

Convenient, to be sure. But is it effective? A recent study suggests it is, though the findings do raise some concerns.

According to Reuters, researchers compared all e-visits and office visits for sinus infections and urinary tract infections (UTIs) at four primary care practices in Pittsburgh, Pennsylvania, between January 2010 and May 2011. Out of 8,000 visits, 90% were office visits.

The study determined that the proportion of follow-up visits (7%) within three weeks was the same regardless of whether the doctor saw the patient in person or not. But people with both conditions who had e-visits were more likely to be precribed antibiotics – and practially all UTI e-visit patients received an antibiotic, compared to just half of office visit patients.

“There are several potential advantages of e-visits, including convenience and efficiency (avoiding travel and time), and lower costs,” wrote author Ateev Mehrotra from the RAND Corporation and University of Pittsburgh School of Medicine, and colleagues.

But Mehrotra added that the difference in prescribing is a concern, especially since over-prescription of antibiotics is tied to drug resistance. “That is something we really need to be careful about and watch for.”

What employees think about their personal health often differs from reality, based on the results of a new survey from Aon Hewitt, the National Business Group on Health and The Futures Company. But the survey also revealed some positive news for employers who offer consumer-driven health plans.

Employee Benefit News reports that the survey of over 2,8000 employee and their dependents covered under employer-sponsored health plans found that while 87% of respondents claimed to be in good health, more than half (53%) have a body mass index in the overweight or obese categories based on their stated height and weight. Only 23% of all respondents believe they are actually overweight or obese, when in reality that number is 34%.

The survey results do suggest, however, that employers can help their workers manage their health as well as their health care costs by offering a consumer-driven health plan. Of the respondents currently in a CDHP, 60% say they have made changes for the better, such as getting more preventive care (28%), seeking lower-cost options (23%) and researching health care costs more frequently (19%).

MedBen has been helping CDHP members make positive behavior changes for over a decade. We offer a complete product line for the self-funded, split-funded and fully insured employer, and can seamlessly coordinate payments between multiple accounts so reimbursements are automatically adjusted in the order desired. And our online support tools allow plan members to manage their accounts from anywhere, anytime.

If you’d like to learn more about the benefits of CDHPs, we invite you to contact our Vice President of Sales and Marketing Brian Fargus at (888) 627-8683.

With only a handful of states committed to operating health insurance exchanges, the Obama administration is undoubtedly concerned how the federal government will somehow oversee the remaining states. So the announcement by the White House extending the state deadline to set up exchanges came as little surprise.

According to The New York Times, the Affordable Care Act set a Jan 1, 2013 deadline for the Secretary of Health and Human Services to determine whether states were ready to operate the online insurance marketplaces. Finding only 17 states in that position, secretary Kathleen Sebelius decided to extend, or even waive, the deadline for any state that expressed interest in creating their own exchange or, at the very least, regulating insurance sold through a federal exchange.

Of course, with every American required to have insurance coverage starting in January 2014, states that have procrastinated thus far are unlikely to have a working exchange in place by then. That leaves federal officials faced with the reality that they will have the primary responsibility for running exchanges in at least half the states next year – a challenge that, based on early evidence, it may not be prepared to handle.

“I assume the federal government is working quickly to build an exchange here and in other states,” said Julie J. Cox-Kain, the chief operating officer of the Oklahoma Health Department. “But the only evidence we’ve seen is a couple of telephone calls seeking information about state insurance regulations.”

Despite the increased popularity of consumer-driven health plans, new government figures show that patients are actually paying a smaller share of overall health care costs.

Kaiser Health News reports that consumers’ share of national health spending continued a downward trend in 2011, falling to its lowest level in decades. Consumers paid 27.7% of the $2.7 trillion health care bill that year, down from 28% in 2010 and 32% in 2000.

While household expenses have outpaced income growth in recent years, other parts of the medical spending pie has grown faster – especially Medicare and Medicaid. When determining consumer health costs, economists factor in insurance premiums, out-of-pocket costs for deductibles and copays, and Medicare payroll taxes.

Patient expirations of such expensive and popular drugs as Prevacid and Flomax have also contributed to lower out-of-pocket costs for patients, said Peter Cunningham, director of quantitative research at the Center for Studying Health System Change. “A lot of that has to do with the shift from brand name to generics.”

Is private health insurance more costly than public health insurance? John Goodman of the National Center for Policy Analysis says the question is “silly", and offers five principles to explain why, which we excerpt below:

Principle 1: There is almost nothing the government can do that the private sector cannot do as well or better. “It is sometimes said that government can produce things at a lower cost because the government doesn’t have to earn a profit. But people who say this never learned the concept of profit in Econ 101. Every hospital, every physician’s office, every other health care business requires capital.”

Principle 2: The few things government can uniquely do can be done without public insurance. “[T]he government doesn’t need to pay provider fees in order to suppress them. It can simply impose price controls on all providers. In fact, if paying providers below-market fees is socially desirable, that is exactly what the government should do for all patients, not just the patients the government happens to insure.”

Principle 3: Most public insurance in this country is actually administered by private insurance companies. “From the beginning, Medicare and Medicaid have been mainly run by private contractors. Who else was going to do it? The government certainly had no experience doing so.”

Principle 4: Most people with public insurance are in private sector health plans. “More than one out of every four Medicare beneficiaries is in a private Medicare Advantage plan and two-thirds of all Medicaid enrollees are in private plans under contract with state governments.”

Principle 5: It is only in the private sector that one finds anyone who has an incentive to lower costs without rationing care. “[T]here are providers who do have an incentive to lower costs and they appear to be responding to those incentives. Surprisingly, they are using some of the techniques the Obama administration says it likes (medical homes, coordinated care, evidence-based medicine, etc.) and that appear not to work well when the government funds pilot programs to try them out.”

Read the rest of John’s comments on his Health Policy Blog.

Recent concerns of a looming shortage of primary care doctors are overblown, a new study suggests. However, some experts have taken issue with the conclusions reached.

According to MedPage Today, an analysis of potential responses to a reduced number of general physicians finds that by working in practices of two or three doctors, shifting a portion of patients to nonphysician providers and making more effective use of electronic health records (EHR), the projected shortage could be successfully addressed.

Writers of the study, published in the January issue of Health Affairs, argue that the statistic that the U.S. will be short more than 45,000 primary care physicians by 2020 doesn’t take into account changing patient demographics or alternate methods of delivering care.

But Modern Healthcare reports a second team of researchers counter that just making changes to existing medical practices and EHR won’t completely solve the problem.

“Our position is that you do have to do that stuff, but you also have to train a couple more thousand doctors a year – it’s not an either-or proposition,” said co-author Dr. Atul Grover, chief public policy officer for the Association of American Medical Colleges.

Grover added that while he agrees “there are ways we can improve practices and we need to make better use of our professionals’ time,” the Health Affairs analysis overstates the usefulness of care delivered online or over the phone, while failing to take into account the lack of doctors in rural areas.

P.J. Skerrett of The Harvard Health Blog reflects on a recent survey which revealed that 37% of physicians sometimes or often prescribed a brand-name drug over a generic when a patient requested it:

“According to the Generic Pharmaceutical Association, the use of generic prescription drugs in place of their brand-name counterparts saved $192 billion last year. We could be doing even better. Seven of the 10 top best-selling drugs in the United States (accounting for $39 billion in sales last year) are brand-name drugs that are also available as generics.

“Much of the extra cost of brand name drugs falls on you. A co-pay for a brand name product usually costs a lot more than its generic equivalent. And the higher costs of brand-name drugs that aren’t covered by co-pays are reflected in higher health insurance costs.

“In most states, a doctor has to write ‘brand only’ on the prescription if he or she does not want you to have a generic. Next time you need a refill, why not ask ‘Hey doc, can I get a generic?’ instead of asking for the brand-name version.”

Skerrett stresses that generics are “chemical clones of their brand-name counterparts", something we also noted on this blog last week.

Need a little more convincing about the value of choosing generic drugs? If you’re a MedBen pharmacy plan member, check out the drug comparison tool at MedBen Access. Click “My Rx Claims” and enter a brand name drug to see the costs of equivalent generics – sometimes, the difference is staggering.

National health spending growth remained low for the third consecutive year, The New York Times reports. The Obama administration said Monday that spending rose $2.7 trillion in 2011, or an average of $8,700 per American.

The 3.9% rate of increase in health spending was the same as in 2009 and 2010 – the lowest three-year trend since the government started collected such data in 1959. Drug spending grew faster in 2011 than the year before, while hospital care spending grew more slowly, according to federal officials.

Kathleen Sebelius, the secretary of health and human services, said that “the statistics show how the Affordable Care Act is already making a difference,” saving money for consumers. But a report issued by the Centers for Medicare and Medicaid Services, in her department, said that the law had so far had “no discernible impact” on overall health spending and that the influence of provisions that have already taken effect “was minimal.”

Micah B. Hartman, a statistician at the Centers for Medicare and Medicaid Services, attributes the slow growth to a reduction in the number of people with private health insurance as well as lower household incomes due to the recession.

Fewer Americans are dying from cancer, a new report finds.

According to WebMD, the report – which includes contributions by the American Cancer Society, Centers for Disease Control, National Cancer Institute, and the North American Association of Central Cancer Registries – says cancer death rates decreased by 1.8% per year among men and by 1.4% per year among women from 2000 to 2009. Declines were seen across all major racial and ethnic groups.

Deaths fell among 17 of the most common types of cancer including lung, colon, breast, and prostate cancers. However, increases were seen in the potentially fatal form of skin cancer, melanoma, in men; uterine cancer in women; and liver and pancreatic cancer in both sexes.

“There is substantial good news in this report,” says researcher Edgar P. Simard, PhD, MPH of the American Cancer Society. He cites earlier detection and better treatment as likely reasons for the decline.

MedBen Worksite Wellness encourages plan members to take advantage of free cancer screenings, to improve the chance that a cancer or other disease can be detected and treated successfully. Based on age and gender, we recommend getting a colonoscopy, mammography, PSA and Pap smear, as well as an annual wellness exam and cholesterol test.

Plan members can also check their compliance with critical wellness examinations by visiting the MedBen Access website and clicking on the Wellness Plan link under “My Plan”. To learn more about MedBen Worksite Wellness, contact Vice President of Sales and Marketing Brian Fargus at bfargus@medben.com.

Health consultants Mercer has put together a list of priorities for self-funded employers in 2013. Not surprisingly, looming changes under the Affordable Care Act will likely play a signficant role in the decision-making process this year. Among the larger concerns:

Prepare for 2014 requirements under health care reform. In 2014, employers will be required to offer qualified health coverage to all employees working 30 or more hours per week – so in 2013 they need to determine who those employees are and whether their health plan qualifies. They also need to inform employees about the new state exchanges.

Evaluate the level of benefits provided. As employers are asked to cover more individuals, they are reconsidering the level of benefits they provide and how much they contribute to the cost. Providing employees with a lower-cost plan (like a consumer-directed health plan) as the core benefit and giving them the option to pay more for richer coverage is one approach gaining momentum.

Ramp up health management programs for long-term savings. Most employers have some type of wellness or health management program, but is it achieving all it can? Employers should consider offering employees incentives to participate – the payoff is a healthier, higher-performing workforce. Social media’s networking capabilities offer new ways to build engagement.

You can read the complete list at Employee Benefits News.

We’ve noted on this blog that regular vision exams can help to identify the onset of diabetes. Now, new research emphasizes just how crucial early detection can be.

According to Employee Benefit News, a study in the Journal of the American Medical Association revealed that higher diabetes rates in American are contributing to greater vision loss that can’t be corrected by glasses. From 1999-2002 to 2005-2008, the rate of non-refractive visual impairment jumped 21%.

“This is real, meaningful vision loss,” said David Friedman, a professor of public health ophthalmology and study author. “We need to do everything we can to try to avoid diabetes altogether and make sure people diagnosed with diabetes are getting repeat eye care to treat anything that develops.”

Meanwhile, a second study – this one published in the Archives of Ophthalmology – found that quality vision insurance is a key to maintaining healthy eyes. Reuters reports that people between 40 and 65 years old with vision insurance were twice as likely to see an eye doctor in the past year than those without coverage, and tended to have better vision status.

MedBen offers early detection and treatment of vision abnormalities through its MedBen VisionPlus plan. Emphasizing regular exams and featuring an extensive provider network, MedBen VisionPlus is an affordable and convenient option for employers with 10 or more enrollees.

To learn more about MedBen VisionPlus, contact Vice President of Sales and Marketing Brian Fargus at (888) 627-8683.

With a long-term prescription for a generic drug, it’s not uncommon for a pharmacist to substitute one version of the generic for another. And more often than not, the replacement will appear different than the original… which can leave the user wondering if it’s as effective.

The reality is, under FDA rules all generic offshoots of a drug must provide the same efficacy – that is, produce the same desired result – as the brand name version. But that fact may mean little to a patient who has come to equate the “look” of a medication to its effectiveness. And a new study of anti-epileptic drugs suggests that such changes can negatively affect a user’s adherance.

According to Pharmalot, the researchers found that patients who take generic drugs that differ in color from a previously prescribed pill are 50% more likely to stop taking the medication. Changes in shape did not produce a similar response, possibly because only four different shapes were represented in the study, compared to 37 colors.

“[C]hanges in pill appearance may not only deprive patients of these expectations of efficacy, but potentially even have the opposite effect – a belief that the newly substituted pill will be less efficacious (the so-called nocebo effect),” the authors noted.

Bottom line, all generic equivalents must work the same. But should you ever have concerns about the appearance of a medication, speak to your pharmacist. MedBen pharmacy plan members can also take advantage of the MedBen Access drug database – simply select “My Rx Claims” and enter a drug’s name to see a list of its alternative versions and their costs.

A few hours before adjourning for New Year festivities, the Obama administration issued an interpretration of employer health care coverage rules under the Affordable Care Act.

According to The New York Times, new provisions proposed by the Internal Revenue Service state that employers with 50 or more full-time employees must offer health insurance to employees and their children. However, if dependent coverage is unaffordable to workers, the employer will not be subject to any penalties.

As to how “affordable” is defined, the IRS proposal said it depends solely on the cost a worker would pay for individual insurance. Self-only coverage under an employer-sponsored plan that “does not exceed 9.5 percent of the employee’s household income” is affordable, according to the proposal.

The definition does appear to create a strong incentive for employers to promote employee-only coverage by offering “affordable” individual premiums, and substantially higher rates for dependents. Spouses are not considered dependents under the IRS rules.

The administration did not clarify whether or not the family of an employee will alternately be able to obtain federal subsidies to help them buy coverage through insurance exchanges.

As 2012 draws to a close, we would like to take a moment to thank our clients for putting your trust in MedBen. We recognize how important health care benefits are to the continued well-being of your employees, and administering those benefits on your behalf is a responsibility that we do not take lightly.

Further, we appreciate that rising medical expenses, coupled with the uncertainty of how the health care reform law will affect employer costs, has only heightened the need for intelligent benefits management. MedBen’s goal in 2013 – as it was in 2012 and has been for the past 75 years – is to ensure that you have the proper tools in which to make informed planning decisions. We will continue to look for benefit solutions that save you money while maintaining the highest quality service.

And if you’re not a MedBen customer? Well, hopefully in the coming months you allow us the opportunity to show you how the MedBen Advantage can benefit your business. But in the meantime… our entire staff would like to wish you a Happy New Year and best wishes for a healthy and prosperous 2013!

A quick reminder: MedBen will be closed on Tuesday, January 1 and reopen the following day. Should you have a claims or benefits question, please visit MedBen Access. Our online customer service center is available 24/7 for your convenience!

In 2012, the big question about the Affordable Care Act was whether or not it would survive the year. But now that we know that its biggest challenges are (apparently) behind it, we’re free to look ahead to health care reform’s future.

While the biggest changes in the law don’t take effect until 2014, we’ll still see some interesting developments in the coming 12 months. WebMD explains several noteworthy changes, which we summarize here:

Health Insurance Exchanges Go Online: State-based health insurance exchanges must be up and running by Oct. 1, 2013. Only 18 states and the District of Columbia agreed to build their own exchanges, while the reminder will either work in partnership with the federal government to operate the marketplace, or simply leave it to the federal government to oversee its operation.

Changes to Itemized Medical Deductions: The threshold for deducting unreimbursed medical costs will increase from 7.5% of adjusted gross income to 10% for individuals under age 65.

Limits to FSA Contributions: Starting in January, pre-tax contributions to flexible spending accounts (FSAs) will be limited to $2,500 a year.

Increased Medicare Taxes on the Wealthy: To help pay for the law, taxes will rise by 0.9%, up to 2.35%, on earnings above $200,000 for individual taxpayers covered under Medicare. In addition, income earned from investments (as opposed to salary) will face a 3.8% tax assessment. Both take effect in January.

Got plans for the weekend? If you’re a MedBen Health FSA member, we’d like to suggest the following itinerary:

1. Visit MedBen Access and select “FSA/HRA Online Inquiry” to check your current account balance. (Alternately, you can go directly to the FSA/HRA Online System to get this information.)
2. Still got some funds remaining? Well, you’ve only got a few days remaining until 2012 wraps up… so it’s time get out of the house and do some medical supply shopping!

Because FSA funds can’t be carried over from year-to-year, you’ll want to empty out your account before the ball drops in Times Square. Fortunately, there are a variety of medical products you can buy with your leftover – and, tax-free – FSA dollars. These include, but are not limited to:

• Eyeglass frames and reading glasses
• Contact lenses and saline solution
• Denture adhesives
• Bandages and gauze pads
• First aid kits
• Blood-pressure monitoring devices
• Nicotine gum or patches

To see a complete list, visit the IRS-eligible Expenses page at MedBen.com.

Those of you who are veteran FSA last-minute-spenders recall that the task was even easier when over-the-counter medications were considered qualified expenses. But the 2010 passage of the Affordable Care Act removed aspirin, ibuprofen cough syrups and other OTCs from the “approved” list – though you can still purchase these with a doctor’s prescription. Insulin and syringes are exceptions to this requirement.

Happy New Year… and happy shopping!

So often with legislation, the devil – not to mention, the cost – is in the details. So it should come as little surprise that a rather pricey health care provision got buried in a recent reglation.

According to The Associated Press, medical plans will be required to pay a $63-per-insured fee to cushion the cost of people with pre-existing conditions under the Affordable Care Act. The fee will be assessed on all “major medical” insurance plans, including those provided by employers and those purchased individually by consumers.

The Obama administration says the assessment is a temporary measure designed to raise $25 billion, and will decline over three years. Most of the money will go into a fund administered by the Health and Human Services Department.

The fee will be implemented in 2014, when the health care reform law will require health insurance companies to accept new members unconditionally regardless of medical history. The fund will serve as a buffer to insurers from the initial unpredictability of covering uninsured people with health problems.