Healthcare Checkup: Employers and Health Insurance in Nevada

 
When it comes to health insurance in Nevada’s employer market, the past year has seen some small changes and developing trends. What the industry looks like in the future, however, remains uncertain as the American Health Care Act of 2017 remains pending in the U.S. Senate. When it comes to health insurance in Nevada’s employer market, the past year has seen some small changes and developing trends. What the industry looks like in the future, however, remains uncertain as the American Health Care Act of 2017 remains pending in the U.S. Senate.

Current Trends

Increasingly, executives of Silver State companies are wanting to offer health insurance to their employees, said Ty Windfeldt, the CEO of Hometown Health, as they are recognizing that doing so helps attract and retain workers in what has been, and remains, a competitive job market. Remember, businesses that employ 50 or fewer employees aren’t required to provide health insurance whereas companies with 50 or more workers must, or pay a penalty.

Hometown Health is a not-for-profit insurance company owned and operated by Renown Health that offers insurance products and services to employers and individuals throughout Nevada, although its primary market consists of employers. It only entered the individual market four years ago.

“We are today [in Nevada] at an all-time high, at least in the number of employers, that are looking at benefits,” Windfeldt added. “We are seeing more and more employers asking the questions — what does it cost and what does it look like — in the small group space.”

Today, Hometown Health provides health insurance to 120,000 individuals who are covered by their employer groups through small group coverage, large group coverage or self-funded third party administration, Windfeldt said. Growth in its employer segment has increased about 10 percent year over year for at least the last three years.

Similarly, UnitedHealthcare (UHC), which offers health insurance plans to employers and individuals, insures more than 300,000 Nevadans via its employer-sponsored plans, most of them through its Health Plan of Nevada. That number has increased in recent years, said Kim Sonerholm, the company’s senior vice president of sales and accounts in the Silver State.

Both Hometown Health and UnitedHealthcare attribute their growth in employer members to an improved Nevada economy and health insurance products that are competitive and focused on patients’ needs.

While providing the best offerings possible, insurers struggle with keeping down the costs of those. One way the carriers are working to achieve that end is by focusing on their insureds’ overall and ongoing health rather than just on the times they’re ill. Many companies are now offering various types of wellness programs and initiatives designed to help people get and remain healthy through preventative measures and conducive lifestyle behaviors. Hometown Health’s Motivate U Challenge is one such wellness program, in which chosen applicants are paired with a personal trainer and spend 12 weeks working on ways to improve their level of health and maintain it.

“We’ve had unbelievable success with the program and just an enormous amount of engagement,” Windfeldt said.

Anthem Blue Cross Blue Shield has also instituted initiatives that holistically help employers build a healthier workforce. The  company’s Time Well Spent program is an online toolkit that includes a “Wellness in the Workplace Employer Guide”. The guide includes tools for employers to build a wellness plan, monthly webinars and links to a blog for employers, among other offerings.

Such health and wellness initiatives are paying dividends in the form of lower health insurance costs to companies, particularly the large ones, Windfeldt said, because the health of their employees and their families directly correlates to insurance premium amounts.

In what has been a major attitudinal shift, employers on the whole are not only extremely responsive to such health and wellness efforts these days, but also requesting them, which was “unheard of five years ago,” Windfeldt said. “We’re seeing significantly more engagement today than we ever have before.”

Employers are also taking a much more active role in getting educated about the plans and programs and their benefits, Sonerholm said.

“They want to sit down, meet with us and understand the value of what’s being offered,” she added. “They want to ensure that we’re delivering something that will make their employees healthier and that what we’re delivering guarantees an overall lower cost of insurance.”

Company executives seem to better recognize now the importance of health insurance coverage and associated wellness strategies to their employees’ well-being and their own bottom line. This, too, is a change. Historically, “benefits were an afterthought for a lot of employers,” Sonerholm said.

Small Employer Market Update

Nevada small businesses (under 50 employees) may use the Small Business Health Options Program (SHOP) to purchase health insurance for their employees.

Yet the number of health insurance plans available through the SHOP has declined from 20 in 2015 to 14 in 2016 and today, said Barbara Richardson, the commissioner of the Nevada Division of Insurance (DOI), which aims to protect consumers’ rights and the public’s interest in dealing with the insurance industry. The scarcity is most pronounced in the silver and gold tiers.

“This is consistent with the shift in health plan costs from the employer to the employee in the form of higher contribution requirements and cost share requirements,” she added.

Currently, only Anthem Blue Cross Blue Shield offers plans on the SHOP for Nevada businesses. The market is fluid and this could change as other insurers join and leave the marketplace in coming years.

Small employers can enroll through the SHOP at any time during the year. However, if a small business wants to enroll without contribution or participation requirements, it has to submit an application to the SHOP between November 15 and December 15 of this year.

Costs Remain a Challenge

A major challenge for Nevada companies with respect to health insurance is the cost of it.

“It’s very expensive and it’s hard for employers in a lot of instances to find the means to provide the benefits,” said Windfeldt.

Will health insurance premiums increase in 2018? On one hand, the continuing move from volume to value in healthcare delivery is benefitting companies with respect to cost. No longer are insureds paying for services rendered while not always receiving adequate quality. Today, they’re demanding they receive the quality and value they expect in those services.

“If outcomes aren’t reasonable and what the patient ultimately expected and desired, then there’s going to be some financial takeback or financial gain from the provider or insurance company that we’ve never had before,” Windfeldt said.

It works in a trickle-down manner, he added. It helps employers if insurance companies are doing their job and providers are doing theirs and the two work in unison.

“Working collaboratively and not paying for things unnecessarily drives costs down and, ultimately, drives premiums down,” he added.

Nevertheless, rates, at least in Nevada’s small employer market, have increased since 2015. The average rate change for small employers was 5 percent for 2016 and 4.7 percent for 2017, Richardson said, noting the market has remained relatively stable due to some state protections and provisions.

Were the American Health Care Act (ACHA) not to be enacted and the Affordable Care Act (ACA) to remain as it was as of early June, significant increases in premiums wouldn’t be likely, Windfeldt said. In fact, some of the pricing volatility created by the launch and implementation of the ACA in the past years should stabilize over the next two. That doesn’t mean, though, small to moderate increases in health insurance costs won’t occur.

If the version of the ACHA that passed the U.S. House of Representatives in early May gets enacted, it likely would increase costs to the insurance carriers and, consequently, to companies providing coverage to their employees, Windfeldt added. This assumes, he said, that the ACHA would result in a rise in uninsured individuals who then obtain care, particularly at hospitals. In that scenario, those facilities would be left without a means to pay for the costs of providing care to that population, thus passing it on to the insurers and the insurers thus passing it on to the insureds, including employers.

As for small businesses, as of July 1, health insurance carriers were permitted to sell in Nevada for the first time exclusive provider organization plans, a type of preferred provider organization plan but more akin to HMO or Medicaid plans, which don’t provide out-of-network benefits for non-emergency care. If a required specialty provider is not in the network, the plan provides coverage for an out-of-network specialist for the patient and doesn’t require patients to consult with a primary care physician before seeing a specialist.

“As a result, small employers will have more affordable plan options in 2018,” Richardson said.

As for solid evidence of premium hikes or not, we won’t get any until the 17th of this month, the deadline for insurers to submit to the DOI the rates for their off-exchange (Nevada Health Link) plans, Richardson said.

Constraints on Access

Nevada businesses also face the problem of their employees not always being able to access healthcare in a timely way. This is because Nevada lacks a sufficient number of physicians, from generalists to specialists, to provide expedient care to all of the people who require and desire it, Sonerholm said.

“We’re continuing to work collaboratively together in the entire industry on how we develop greater access across the gamut,” she added.

Insurers have added coverage for components designed to improve access, such as telemedicine, virtual visits, convenient care clinics and retail centers. Anthem Blue Cross Blue Shield’s LiveHealth Online (LHO) is a telemedince app avalaible to Anthem members and non-members. The app gives users access to a physician at any time of the day or night. LHO also has a mental health component, LHO Psychology, allowing patients to visit with mental health professionals from the privacy of their home or office.

On the physical visit front, UHC is test piloting Medicine on the Move, a 45-foot mobile medical center that travels throughout the state, even to the rural areas and to companies upon request, providing care where there’s demand. It’s equipped with two exam rooms, mammogram and ultrasound equipment, laboratory and x-raying capabilities and heating and air conditioning.

“It’s been very successful so far,” Sonerholm said. “We’re consistently looking for ways to innovate and deliver new services and value to Nevada companies.”

Some Silver State employers are taking steps on their own to solve the access problem.  Eldorado Resorts Inc., the parent company of Northern Nevada’s Circus Circus, Eldorado and Silver Legacy hotel-casinos, opened a 4,450 square-foot, on-site medical clinic. Eldorado Resorts Family Medical Center which opened in May, provides workers quicker, easier access to healthcare. Insured patients can see a provider within 24 hours without being charged any co-pays or added fees.

Potential ACHA Impacts

Sources for this article declined to comment on how the ACHA, in the version as of early June, would impact Nevada businesses with respect to health insurance. However, national experts noted the act would likely result in these major company-related changes:

Large companies (50-plus employees) no longer would have to provide health insurance for employees.

Small businesses (fewer than 50 employees) would not be penalized for not offering employees health insurance coverage.

Micro-companies (fewer than 25 employees and with average wages that are less than $50,000) wouldn’t be able to claim the healthcare tax credit after 2020, when it gets eliminated. Also, beginning in 2018, businesses of this size wouldn’t be able to use that credit toward plans that cover abortions.

“We’re moving to where I think the mandate will be lifted or lessened as far as the penalty for large employers, but I don’t believe that will have a change on how employers operate today,” Windfeldt said. “More and more employers feel a desire and need to offer health insurance. If you polled large employers and asked, would you stop offering benefits if the mandate was lifted, I’d say the vast majority would say no, we’ll still offer it.”

UHC’s Sonerholm didn’t “want to speculate as to what’s going to happen with the federal law.” She added, “We’re committed to the market and to Nevada, and we’ll make the necessary adjustments to make sure we continue providing quality, objective benefits.”

The ACHA wouldn’t affect Hometown Health generally, Windfeldt said, because the carrier doesn’t participate in the health insurance exchange. If anything, the insurer might experience slight growth in membership from people leaving the exchange.

“This is one of the stronger positions that we’ve been in, and we’re looking for some strong years to come,” he said. Despite the uncertainty with health insurance nationally, “we still feel strongly Nevada is going to be a good state going forward.”

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