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Healthcare early renewal options

Effective January 1, 2014 the healthcare landscape will dramatically change due to the implementation of the Affordable Care Act (health care reform). All plans renewing in 2014 will be required to offer benefits that meet the new ACA mandates which for many groups could mean significant increases upon their renewal.

 Current and previous year’s renewals were based on annual trend, the overall health status of the group, and the overall group demographics. In 2014 renewals will be based on an annual premium rate increase, premium rate adjustments due to Community rating (the elimination of health status, industry, and case size rating), maximum plan deductibles, new insurer fees & taxes, the requirement of Essential Health Benefits, and other possible mandates and fees. Through our research we have determined that clients renewing in early 2014 could receive increases anywhere between 30-50% just to comply with the new regulations.

 Hoffman Insurance Group is pleased to offer you solutions to avoid the immediate impact of the Affordable Care Act by electing an off-cycle fourth quarter 2013 renewal. This will give you the ability to avoid the immediate significant increases and gain the leverage you need to assess your future needs. Changing to an off-cycle renewal may not make sense for all groups, if you would like to discuss this in further detail please contact our office.

 Each carrier has established different guidelines for an off-cycle renewal. Please review the guidelines for your carrier below.

 Aetna

To change your renewal date to the fourth quarter of this year, Aetna has established the following guidelines:

 –   If your regular plan renewal falls between January and June the following will apply:

  • Aetna must receive the request for a plan change 90 days prior to the requested effective date. For example, if you would like your new plan renewal to fall on December 1, Aetna must receive notification by September 1.
  • Aetna will then provide rates and you must accept the rates 45 days in advance of the projected plan renewal.

 –  If your regular plan renewal falls between July and December the following will apply:

  • Aetna must receive notification of the requested plan change 30 days prior to your regular renewal in order to change to a later renewal date. For example, if your regular plan renews July 1, Aetna must receive your request to change your renewal date by June 1.
  • Once the request has been made, it cannot be undone. However your regular renewal rates will apply and no further change in the rates will be made until your new requested renewal in the following 2014 plan year.

 Assurant Health

*No details yet, waiting on feedback from the carrier

 BlueCross BlueShield

*No details yet, they’re hoping to release guidelines on early renewals by late June

 Humana

To change your renewal date to the fourth quarter of this year, Humana has established the following guidelines:

–          Humana must receive your request 4 months prior to the requested renewal date. For example, if you would like your new plan renewal to fall on December 1, Humana must receive notification by August 1.

–          Humana will provide you the chance to review the rates before you accept the new renewal date if the rates are greater than 5% of what is expected.

 UnitedHealthcare

–          Currently the only early renewal option being offered is for groups that renew between January and June. Request must be received by June 15th.

Please contact us if you would like to discuss your options and what is best for your company.

 *updated 5/8/2013

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