No one likes a trip to the hospital. What can make the situation worse is getting a bill you never even saw before being discharged. A recent study has found that some hospitals are marking up treatments by as much as 1,000 percent, and that the average hospital in the United States charges uninsured patients three times what Medicare allows.
During a recent study, researchers examined 2012 Medicare cost reports. They studied the charge to cost ratio to see how much hospitals were increasing prices beyond what Medicare pays people on its insurance. On average, U.S. hospital charges were 3.4 times the Medicare-Allowable cost in 2012. In other words, when the hospital incurs $100 of Medicare-Allowable costs, the hospital charges $340.
Medicare typically pays a hospital on a cost plus basis. This means that a hospital gown costing three dollars receives a Medicare payment of $3.45. However, the private insurance plan may be charged $150 before they apply a negotiated discount. The insurance carrier will get a 50 percent discount off the $150 charge, but the patient would still pay $75 through higher premiums and deductibles.
Hospitals negotiate different rates with different payers. Then there are in-network and out-of-network rates. Furthermore, patients often don’t know until after they’ve received treatment whether their insurance will pay for it or for the doctors who delivered it.
Cost control is how the government controls the charges by hospitals, but private plans and consumers do not have the power of regulation. What consumers need to do is to request a hospital or other medical service provider to disclose their cost of work before the service is provided. This way consumers can find the most cost effective provider's service. The end result is competition's "invisible hand" will keep cost competitive thus lowering all of our health insurance premiums. This type of cost control approach works in every other business model. For example: did you every buy a new television without knowing the cost before purchasing?
How IAA can Help
Insurance Administrator of America has a new approach to reducing costs: by using the hospital’s own Medicare reporting data. IAA can help accomplish this for your business’s self-funded health plan.
Our program of services seeks to identify the medical provider’s actual cost to deliver the service and to allow for a fair margin above that cost. Should a medical provider pressure or threaten a plan member in a balance bill situation, our program's legal team will provide defense to the member and the plan.
Our program utilizes various cost identification sources with a particular focus on Medicare and the annual cost reports many medical providers submit to the Centers for Medicare and Medicaid Services (CMS). The Audit Program has three components:
- Plan language that contains clearly stated and rational limits on reimbursement.
- An appeal process that provides a full and fair review of any appealed claims.
- A vigorous defense of the plan and plan member in the event of a balance bill or collection action.
The result is reduced cost and a process that balances the rights of medical providers for fair reimbursement with those of the plan sponsor and plan members that pay for care.
The basic IAA program addresses three central areas:
- Regulatory compliance: IAA provides access to an objective third party review process for medical/experimental determinations and coverage decisions through final level of appeal. Focus areas include document review, DOL and HIPAA compliance, and general consultation on plan design.
- Quality medical review: IAA has access to nationally recognized, and URAC accredited independent review organizations. This allows plans to comply with DOL regulations regarding medical consultations and further assures that benefit decisions are based on rational, impartial and defensible medical protocol.
- Plan co-fiduciary: An independent team is appointed as co-fiduciary with your plan document. They share the responsibility with the plan sponsor to ensure that issues that arise within the management of your plan are effectively and prudently resolved.
On average, IAA's services reduces the cost of healthcare for a business by $150,000 per 100 employees.
If you are interested in learning more about how IAA's "cost plus" program can work in conjunction with your self-funded plan, please contact IAA for more details at 856-470-1200 ext. 223 or Paul Kelly at email@example.com.
This summer is off to a stormy start! Don’t get caught in a dangerous situation, be prepared for whatever summer weather rolls your way.
Know Your Terms
When breaking weather alerts come through on your television and mobile devices, it is important to understand what is going on. Here are some “warnings” and “watches” that might pop up on your screen:
- Severe thunderstorm watch: Conditions are conducive to the development of severe thunderstorms in and around the watch area. These storms produce hail of a ¾ inch in diameter and/or wind gusts of 58 miles per hour.
- Severe thunderstorm warning: Issued when a severe thunderstorm has been observed by spotters or indicated on radar, and is occurring or imminent in your area. These warnings usually last for a period of 30 to 60 minutes.
- Tornado watch: Conditions are favorable for the development of severe thunderstorms and multiple tornadoes in and around the watch area. People in the affected areas are encouraged to be vigilant in preparation for severe weather.
- Tornado warning: Spotters have sighted a tornado or one has been indicated on radar, and is occurring or imminent in the warning area. When a tornado warning has been issued, people in the affected area are strongly encouraged to take cover immediately.
Be on the lookout for these warnings.
A thunderstorm is considered severe if it produces hail at least one inch in diameter or has wind gusts of at least 58 mph. Every thunderstorm produces lightening which kills more people some years than tornadoes or hurricanes. Heavy rain from thunderstorms can cause flash flooding. Every year people are killed or seriously injured because they didn’t hear or ignored severe thunderstorm warnings.
Make sure you stay safe during a severe thunderstorm:
- If thunder roars, go indoors! Don’t wait for rain; lighting can strike out of a clear blue sky.
- Avoid electrical equipment and corded telephones.
- Avoid contact with plumbing: Do not take a shower, do not wash dishes and do not do laundry.
- Keep away from windows.
- Do not lie on concrete floors and do not lean against concrete walls.
To prepare for a thunderstorm, you should do the following:
- Remove dead or rotting trees and branches that could fall and cause injury or damage during a severe thunderstorm
- Secure outdoor objects that could blow away or cause damage
- Shutter windows and secure outside doors
- Unplug any electrical equipment well before the storm arrives
Make sure you are prepared for summer storms!
A tornado is a violently rotating column of air extending from the base of a thunderstorm down to the ground. When you are watching for rapidly emerging tornadoes, it is important to know that you cannot depend on seeing a funnel---clouds or rain may block your view. The following signs may mean that a tornado is approaching:
- A dark or green colored sky
- A large dark or low lying cloud
- A loud roar that sounds like a freight train
- Large hail
Pick a place in the home where family members can gather if a tornado is headed your way. One basic rule is avoiding windows. An exploding window can injure or kill. The safest place in the home is the interior part of a basement. If there is no basement, go to an inside room, without windows, on the lowest floor. This could be a center hallway, bathroom or closet. If possible, cover your body with a blanket, sleeping bag or mattress, and protect your head with anything available—even your hands.
The best way to stay safe during a tornado is to be prepared with:
- A list of important information, including telephone numbers
- An emergency kit (including water, non-perishable food and medications)
- Fresh batteries and a battery operated TV, radio or Internet enabled device to listen to the latest emergency weather information
According to the National Oceanic and Atmospheric Agency there is no guaranteed safety during a tornado.
What IAA has to Say
Insurance Administrator of America wants you to be safe during summer storms! While many people enjoy watching storms play out, weather is something to take seriously. Mother Nature is someone we cannot control, so it is always best to be cautious. IAA wants you to prepare yourself for summer storms.
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Craniofacial defects are conditions present at birth that affect the structure and function of a baby’s head and face. One of the most common craniofacial defects is orofacial clefts, which occur when the lip and mouth do not form properly.
What are Cleft Lip and Cleft Palate?
Cleft lip and cleft palate occur when tissues in the baby’s face and mouth don’t fuse properly. Normally, the tissues that make up the lip and palate fuse together in the second and third months of pregnancy. In babies with cleft lip and cleft palate, the fusion never takes place or occurs only part way.
A cleft lip is a split in the upper lip. This can happen on one or two sides of the lip, creating a wider opening into the nose. This separation often extends beyond the base of the nose and includes the bones of the upper jaw and/or upper gum.
A cleft palate is a split in the roof of the mouth. This leaves a hole between the nose and the mouth. A cleft palate can involve the hard palate (the bony front portion of the roof of the mouth) and/or soft palate (the soft back portion of the roof of the mouth).
A baby with cleft lip and cleft palate may have other difficulties as well:
- Dental problems: Children with cleft lip or cleft palate often have dental problems. These problems include small teeth, missing teeth, extra teeth, or crooked teeth.
- Ear and hearing problems: Children with cleft palate are at an increased risk of ear infections since they are more prone to fluid buildup in the middle ear. Hearing loss can also happen due to fluid buildup.
- Feeding problems: With a separation or opening in the palate, food and liquids can pass from the mouth back through the nose.
- Speech problems: When you talk, the muscles of your soft palate help to keep air from blowing out of your nose. Kids with cleft palate find their soft palate sometimes does not move well and lets too much air leak out of their nose while speaking. This gives children problems with certain sounds and it makes them sound like they are speaking partly through their nose.
Kids with cleft lip and palate will need several surgeries to fix the cleft.
While not much is known of the cause of clefts, researchers have found some risk factors:
- Exposure to certain substances during pregnancy: Cleft lip and cleft palate may be more likely to occur in pregnant women who smoke cigarettes, drink alcohol or take certain medications.
- Family history: Parents with a family history of cleft lip or cleft palate face a higher risk of having a baby with a cleft.
- Gender: Males are twice as likely to have a cleft lip with or without cleft palate. Cleft palate without cleft lip is more common in females.
- Having diabetes: There is some evidence that women diagnosed with diabetes before pregnancy may have an increased risk of having a baby with a cleft lip with or without a cleft palate.
- Obesity: There is some evidence that babies born to obese women may have an increased risk of cleft lip and cleft palate.
The Centers for Disease Control estimates that each year in the United States about 2,650 babies are born with cleft palate and 4,440 babies are born with cleft lip with or without cleft palate.
What IAA has to Say
Insurance Administrator of America wants you to support Cleft and Craniofacial Awareness and Prevention Month by reading this blog post. Feel free to share this information by sending this blog post on to friends and colleagues. Remember, with IAA one call does it all.
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The Fourth of July is filled with fun, food and fireworks. Make sure you not only have a good time this holiday weekend, but that you and your loved ones are safe as well.
Fourth of July Fireworks
One part of Fourth of July everyone looks forward to are fireworks. Fireworks can be a great way to end the Fourth of July, but they can also be dangerous. On average, 240 people go the emergency room each day with firework related injuries in the month leading up to Independence Day. Make sure to take precautions when handling fireworks:
- Don’t carry fireworks in your pocket
- Keep a bucket of water or a garden hose handy in case of fire
- Never let young children play with or set off fireworks
- Never place any part of your body directly over a firework device when lighting the fuse. Back up a safe distance immediately after lighting fireworks.
- Never re-light or immediately pick up fireworks that have not ignited fully
The safest way to enjoy fireworks is to attend a public fireworks show put on by professionals.
Buckle up for the Fourth of July
The first week of July is typically one of the busiest American travel periods of the year, as many people utilize the holiday for extended vacation trips. Make sure to be safe out on the roads this Fourth of July weekend:
- Before leaving, ensure that your vehicle is in good working condition
- Buckle up for safety: In the majority of accidents seat belts save lives. According to the Centers for Disease Control, seat belts reduce crash related injuries and deaths by about 50 percent.
- Don’t drink and drive: All 50 states and D.C. have laws defining driving impaired as a crime. Drinking alcohol slows reaction time and impairs judgment and coordination.
- Observe speed limits: Allow plenty of time to get to your destination. Most likely you will have to share the road with thousands of other drivers, road construction, and possible rain and thunder storms.
- Put distractions away: Don’t talk on your cell phone while driving, both require focus. You can only do one well.
- Stay alert: Take a break when feeling drowsy. Take advantage of rest stops. Drive defensively.
Getting to your Fourth of July destination on time is important, but getting there in one piece matters even more.
The sun can do some major damage to your body, so make sure to be careful outdoors this Independence Day. Remember to drink plenty of water even if you are not thirsty. To keep from dehydrating follow the 70/70 rule. When the temperature and humidity are both above 70°F, you enter the dehydration danger zone. Stay safe by frequently sipping from a bottle of water.
Watch for signs of heat stroke-----hot red skin, changes in consciousness, rapid, weak pulse, and shallow breathing. If you think someone is suffering from heat stroke:
- Call 911 and move the person to a cooler place.
- Quickly cool the body by applying wet clothes or towels to the skin and fanning the person.
- Watch for signs of breathing problems and make sure the airway is clear. Keep the person lying down.
No one wants to leave the party early because they weren’t safe in the sun, so make sure to keep a bottle of water handy at all times!
What IAA has to Say
Insurance Administrator of America hopes your Fourth of July is full of fireworks and fun! Just make sure that you take safety precautions wherever they’re needed. No one wants to come into the office with a story of how they went to the emergency room over the holiday. IAA wishes you a fun and safe Independence Day.
The Supreme Court of the United States will soon be making a decision on a case that could affect millions of people. The case of King vs. Burwell will decide whether those who use the federal marketplace to buy their health insurance will be allowed to receive a subsidy.
The Background of King vs. Burwell
On March 4, 2015 the Supreme Court of the United States heard King vs. Burwell, a case challenging the availability of Affordable Care Act premium subsidies in states with a federally run marketplace. The law provides for advanced payment of premium tax credits for people with incomes between 100 to 400 percent of the federal poverty level, and cost sharing reductions for people with incomes 100 to 250 percent of the federal poverty level.
In implementing its regulations, the Internal Revenue Service interpreted the ACA to authorize premium subsidies for individuals who purchase coverage on all marketplaces. The King vs. Burwell petitioners are challenging the legality of the IRS regulation allowing premium subsidies in states with a federally run marketplace.
The Two Sides
The controversy of this case lies in the wording of the ACA provision that amends 36B of the Internal Revenue Code “the premium subsidy amount is based on the cost of the qualified health plan…enrolled in through a Marketplace established by the State under 311 of the [ACA].”
The petitioners (King) want the Supreme Court to strike down the IRS regulation making subsidies available to individuals who purchase health plans in a state with a federally run marketplace. Their argument is that the IRS lacks the authority to issue this rule because they contend the ACA’s language is clear that these subsidies only are available in state-based marketplaces.
The respondents (Burwell) of this case are federal agencies charged with implementing the ACA. The federal government wants the court to uphold the IRS’s regulations making subsidies available in states with a federally run marketplace. The federal government argues that the IRS’s rule is consistent with the language of the ACA because a marketplace “established by the state” also means one established by the Department of Health and Human Services standing in as a surrogate for the state.
What the Future Could Hold
The Supreme Court’s decision could affect the number of people who ultimately have access to affordable coverage under the ACA.
- If King wins: If the IRS rule is overturned by the Supreme Court, people in 34 states would lose access to subsidies. Overturning the IRS rule also would essentially nullify the requirement that large employers offer coverage to full time employees in these states. The applicability of the employer mandate is dependent upon the premium subsidies because the associated tax is triggered when one of an employer’s full time workers receives a subsidy. If there are no subsidies, then an employer would never be subject to the tax for failure to comply with the employer mandate.
- If Burwell wins: If the Supreme Court upholds the IRS rule, subsidies will continue to be administered through all marketplaces.
The Supreme Court will be making a decision near the end of June, 2015.
What IAA has to Say
Health coverage is not only important to those who have a chronic illness, but it is also vital to maintaining a healthy workforce. Insurance Administrator of America wants you to have healthy and active employees.
For businesses who do not have health coverage for their workers, IAA has introduced many companies to self-funded healthcare plans. IAA works with you to design a program, pay and manage claims, establish a provider network, and obtain stop-loss coverage. Remember, with IAA one call does it all.
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