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When we come across interesting and informative facts and tidbits we will share them with you here:

Re: Increased demand for life insurance in 2005

“Survey Finds Rise in Demand for Life Insurance”, Cathy Chu, Wall Street Journal, 4/12/05 (page D3) -- According to LIMRA (a research and consulting firm that tracks trends in life insurance): 

-50% of US households believe they need more life insurance and 25% believe they will purchase it in the coming year.

-Fewer people are getting life insurance benefits at work.  In 2004, only 48% of workers had group life insurance compared to 56% in 1999.  One reason cited, more employers are making group life insurance a “voluntary” benefit, meaning employees pay for the cost of their group life insurance instead of their employer.

-43% of life insurance policies purchased in 2004 were term life and 37% were permanent life.

Re: What’s the current buzz on HSA’s?  Few employees have elected them and the need for greater education is highlighted.

“Passing the Buck”, Chris Penttila, Entrepreneur, May 2005 (page 18) – Consumer-driven health plans, like 401(k) plans, reduce employer premiums and liability, but require employees to be more pro-active in managing their own benefits.  “Because consumer-driven plans tend to be low-margin products for insurers, employees will be pushed on-line, where they’ll spend work rime deciphering their benefits.  That means less productivity on the job.”  According to Information Strategies, a marketing information company, their “survey of 5000 managers and employees in December 2004 to gauge the effect of consumer-driven health plans on worker satisfaction found 31% of employees are uncomfortable with the requirements and education being offered under consumer-driven plans and 41% indicated that they were receiving very little education regarding tools and programs.  22% said they aren’t complaining loudly because they are afraid of losing the benefits.”  According to Battley Performance Consulting, “employees over the age 40 who are used to a paternalistic view of health-care and retirement plans will need more guidance than younger employees.”   

“Federal Workers Slow to Sign Up for Health Option”, Sarah Lueck, Wall Street Journal, 5/4/05 (page D5) – Fewer than 5,000 of the more than 8,000,000 employees, dependents and retirees eligible for the Federal Employees Health Benefits Program have elected the new high deductible HSA (health savings account, also known as consumer driven healthcare) for themselves and their families…..As of March 2005, only 1,031,000 accounts were opened overall in both the government and private sectors combined (according to America’s Health Insurance Plans, an industry trade group).  Lack of familiarity with this new option was cited as one reason few have elected this type of plan to date.  It is believed that as Americans become more educated about HSA’s and as more private employers offer this option, future enrollments will rise.

 Advisor Today, March 2005 (page 36) – Steve Kraus of Deloitte Consulting suggests that the shift to high deductible consumer driven healthcare plans (CDHP’s) “is a significant change and the educational component is critical, but the interest is certainly growing.”  Deloitte’s survey of their own employer clientele suggests that “20% of companies have CDHP’s in place and that can potentially double by 2006”.

March 2005, Joshua Kurlantzick, Entrepreneur (page 71) – “In a March 2004 study (of 3000 public and private employers with 10 or more employees) by Mercer Human Resource Consulting, nearly 75% of employers said they are very of somewhat likely to offer their employees a high deductible health plan with an HAS by 2006.  Employees may not welcome the news.  According to a study by Watson Wyatt Worldwide released in January, less than one third of workers who have health insurance know what HSA’s are.  Once respondents were given an explanation of the plans, 57% said they did not want to pay higher deductibles.”…… “According to Joel Marks of the American Small Business Alliance, “HSA’s are for the healthiest and wealthiest.  He fears sicker employees would not choose plans where they had to pay such a high deductible.  Small companies with sicker employees might then find their premiums rising”…… “In a 2004 Kaiser Family Foundation study, more than three-quarters of respondents had an unfavorable opinion of high-deductible health plans, and many feared such plans would leave them vulnerable to high medical bills.”…….. “A July 2004 study by the Center for Studying Health System Change, found employers worried about how they could possibly provide enough health-care education to employees to help them make educated choices under an HSA.”   

Re: Results are in from trial linking the government’s Medicare & Medicaid reimbursements to quality of care

“Push for Performance-Based Pay in Healthcare Receives a Boost”, Sarah Lueck and Gintautas Dumcius, Wall Street Journal, 5/4/05 (page D5) – “Efforts to pay hospitals and physicians for medical services bases on their performance are moving forward, as the government and healthcare providers announced progress toward linking reimbursement to quality and efficiency.”  According to the Centers for Medicare and Medicaid Services,  “preliminary analysis of Medicare’s pay-for-performance trial involving 270 hospitals with more than 400,000 patients showed improvements in scores for quality of care:

            -93% (up from 90%) for patients with heart attack

            -90% (up from 86%) for patients with heart bypass grafts

            -76% (up from 64%) for patients with heart failure

            -91% (up from 85%) for patients with hip and knee replacements

            - 80% (up from 70%) for patients with pneumonia”

Re: Combined life insurance and long-term care policies gaining popularity

“A Combo Policy for Long-Term Care”, Carol Marie Cropper, BusinessWeek, 5/2/05

(Page 91) -- Insurers have seen a 30% drop in sales of pure long-term care coverage, leading them to offer new policies that combine life insurance with a rider that pays out all or part of the death benefit in advance should the insured be confined to a nursing home, or in some cases, need home health care or assisted living.  With this new type of combined policy “there is a payoff either way”--the policy provides life insurance benefits for their survivor in the event of premature death, or cash value accumulation in the event of a long life, or money to pay for long-term care if needed.

“As Fee Increases Hit Holders of Insurance for Long-term Care, Is it Safe to Buy?” Terri Cullen, Wall Street Journal, 3/2/05 (page D1) – “If you have a so-called cash-value life insurance policy, check the fine print.  Many include riders such as a living benefit or an accelerated death benefit which in some cases may allow you to tap the policy to pay long-term care costs.”

Re: Who still offers retiree health coverage?

“The Great State Health-Care Giveaway”, Janice Revell, Fortune, 5/2/05 (page 46) – Percentage of large employers offering retiree health benefits in 2004:  77% state and local government, 36% service, 32% manufacturing, 22% health care, 10% retail.

“Court Says Retiree Benefits Must Be Equal”, Associated Press, Wall Street Journal, 3/31/05 (page D2) – “The proportion of companies with more than 1,000 workers offering health coverage to retirees dropped form 80% in 1991 to 57% in 2003, according to a study by the benefits consulting firm Hewitt Associates and the Kaiser Family Foundation.”……... “The US Equal Employment Opportunity Commission (EEOC) had proposed exempting retiree health plans from age discrimination rules as part of an attempt to slow the trend of  companies eliminating retiree health benefits altogether”, however, “a federal judge barred the government from implementing this regulation (because) it would have allowed companies to provide generous healthcare benefits to young retirees, but less coverage to those old enough to qualify for Medicare…...the regulation would violate an established legal precedent that companies may offer different health plans to retirees of different ages only if they are of equal value or provide equal benefits.”

“Retirees’ Families Face Health Cuts”, Jennifer Saranow, Wall Street Journal, 3/3/05 (page D2) – “A growing number of employers are excluding new dependents (spouse and children) from their retirees’ health-care plans, while others are cutting coverage amounts for retiree’s current dependents…….Others are dropping current employees’ future retirement benefits…….According to a survey on retiree health benefits released in December (2004) by the Kaiser Family Foundation and consulting firm Hewitt Associates, 79% of surveyed large employers report having increased retiree contributions to premiums in the past year and 68% reported increasing contributions for dependent coverage……..The upshot is that retirees could be left bearing the brunt of covering their families, or left in the lurch if spouses with insurance elsewhere lose coverage.  Some may even have to return to work.”

Re:  “Healthy Lifestyle” study results are in, and the results are “shocking”!

“Only 3% of Americans Lead a ‘Healthy’ Lifestyle”, Jennifer Corbett Dooren, Wall Street Journal, 4/26/05 (page D6) – According to a Michigan State University study as reported in the Archives of Internal Medicine, only 3% of Americans lead a healthy lifestyle that includes four targets:  maintaining a healthy weight, not smoking, eating at least the minimum of recommended fruits and vegetables per day and exercising at least 30 minutes a day/five times per week.  Alcohol consumption was left out of the study because of the varying opinions about the benefit/harm of moderate alcohol use.  Lead researcher Mathew J. Reeves was “shocked” by the results.  He expected to find at least 15% of the population hitting what he calls the “healthy lifestyle index”.  Data was compiled using survey data of more than 150,000 Americans by the Centers for Disease Control and Prevention.  Overall, 4.2% of women met the healthy lifestyle indicators, while only 1.9% of men did so.   College graduates fared better with 5% leading healthy lifestyles, compared to 3.2% with some college, 1.9% with a high school diploma and 0.8% with some high school education.  The age group that fared the worst was 35 to 44, with only 2.5% hitting all four indicators, compared to seniors over 65 who did the best at 4%.

Re: Brand-name prescription drug prices on the rise

Associated Press Online, 4/12/05 – AARP released results from their annual Rx Watchdog Report for 2004, which tracks wholesale drug price increases for approximately 200 of the most popular brand-name drugs used by America’s seniors.  “Wholesale prices for name-brand drugs jumped an average of 7.1 percent in 2004, the largest hike in five years and more than twice the 2.7% rate of inflation.”  In 2003, the rate of increase was 7.0.  “Since the end of 1999, prices of more than 150 popular brand-name drugs have risen an average of 35.1%, nearly three times the 13.5% inflation rate over that period.

“Price Increase on Popular Drugs”, Heather Won Tesoriero and Scott Hensley, Wall Street Journal,1/25/05 (page D1) – “The steady rise in drug costs during recent years has propelled large employers to raise the co-payments for brand-name medicines, and many companies are moving to a co-insurance model that charges employees for a percentage of the drug’s retail cost.”

Re: Get a “Medical Alert” bracelet---It could just save your life

“Low Tech Lifesavers: Medical Bracelets Are an Underused but Crucial ER Tool”,  Kevin Helliker, Wall Street Journal, 4/5/05 (page D1) – For decades, emergency room physicians and their patients afflicted with serious medical conditions and allergies have mutually benefited from the use of Medic Alert bracelets, saying these “decades-old medical-warning tags represent one of medicine’s most underutilized tools.  The number of Americans afflicted with conditions that warrant such tags reach the tens of millions…yet California based nonprofit Medic Alert has just four million patients participating worldwide.”  When worn, the patient’s bracelet tag provides emergency medical professionals with an 800 number to call for details on a patient’s medical history and drug regimens, phone numbers to involved primary care physician and specialists as well as family members.  The American Medical Association has reported in their Journal of the American Medical Association that use of the tags are “crucial” for patients with allergies to drugs, food and other disorders.  Lack of fashion is cited as one of the reasons some people who should wear a Medic Alert bracelet fail to do so.  Fashion jewelry makers offer gold and sterling  versions of the bracelet, but they don’t offer the 800 number access to the patient’s personal medical history and “emergency physicians advise against jewelry that is so fashionable as to make the medical warning inconspicuous.”  Don’t procrastinate--talk to your physician to see if you would benefit from wearing a Medic Alert bracelet.

Re: Mercer’s 2004 National Survey of Employer-Sponsored Health Plans just released

3/23/05, www.mercerhr.com – Mercer’s survey of over 3,000 employers with 10 or more employees, both public and private, is now available.  Some of the highlights are as follows:

            -Health & dental care costs per employee rose an average of 7.5% in 2004, the lowest increase since 1999 and down from the 10.1% average increase in 2003.  Employers with over 500 did not fare quite as well, with the average cost per employee rising 9.0%, with employers of 10-499 employees experiencing an average per employee increase of just 5.5%.

            -The average cost of medical & dental health benefits for active employees rose from $6,215 per employee in 2003 to $6,679 in 2004.

            -Employers are projecting that increases will continue to slow in 2005.  Without plan changes, employers are expecting increases of 10.0%, but plan to bring those increases to 6.6% with plan design modifications and carrier negotiations.

Re: Historical healthcare costs as % of GDP

Joshua Kurlantzick, Entrepreneur, March 2005 (page 71) – “Healthcare constituted 6% of the US gross domestic product in 1970, just under 13% in 2002, and is expected to reach 17% by 2011.”

Re: The government and healthcare spending

“Government is Likely to Pay 49% of All U.S. Health Costs By 2014”, Sarah Lueck, Wall Street Journal, 2/24/05 (page A4) – “Growth in heathcare spending will continue to slow, but federal, state and local governments will be picking up nearly half of all US health costs within a decade, a shift that largely reflects Medicare’s new prescription drug coverage.   Government will pay 49% of health costs by 2014, up from 46% currently, 43% in 1980 and 38% in 1970.

“Drug Benefit Cost Put at $720 Billion for First 10 Years”, Sarah Lueck, Wall Street Journal, 2/9/05 (page D5) – “The new Medicare drug benefit will cost a net $720 billion in its first 10 years.”