If the Supreme Court strikes down President Barack Obama’s health care law, employers and insurance companies, not the government, will be the main drivers of change over the next decade and maybe even longer.

They’ll borrow some ideas from Obamacare, and push harder to cut costs.

• Workers will bear more of their own medical costs as job coverage shifts to plans with higher deductibles, the amount you pay out of pocket each year before insurance kicks in. Traditional workplace insurance will lose ground to high-deductible plans with tax-free accounts for routine medical expenses, to which employers can contribute.
• Increasingly, smokers will face financial penalties if they don’t at least seriously try to quit. Employees with a weight problem and high cholesterol are next. They may get tagged as health risks and nudged into diet programs.
• Some companies will keep the health care law’s most popular benefit so far, coverage for adult children until they turn 26. Others will cut it to save money.
• Workers and family members will be steered to hospitals and doctors that can prove to insurers and employers that they deliver quality care. These networks of medical providers would earn part of their fees for keeping patients as healthy as possible, similar to the “accountable care organizations” in the health care law.
• Some workers will pick their health plans from a private insurance exchange, another similarity to Obama’s law. They’ll get fixed payments from their employers to choose from four levels of coverage: platinum, gold, silver and bronze. Those who pick rich benefits would pay more. It’s an approach that Rep. Paul Ryan, R-Wis., the GOP budget leader, also wants to try with Medicare.

“Employers had been the major force driving health care change in this country up until the passage of health reform,” said Tom Billet, a senior benefits consultant with Towers Watson, which advises major companies. “If Obamacare disappears … we go back to square one. We still have a major problem in this country with very expensive health care.”

Republican proposals for replacing the health care law will help some businesses and individuals, but aren’t likely to solve the problem of the uninsured because of the party’s opposition to raising taxes. The GOP alternative during House debate of Obama’s law would have covered 3 million uninsured people, compared with more than 30 million under the president’s plan.

After the collapse of then-President Bill Clinton’s health care plan in the 1990s, policymakers shied away from big health care legislation for many years. Many expect something similar to happen if the Supreme Court invalidates Obama’s Affordable Care Act.

Starting in 2014, the law requires most Americans to obtain health insurance, either through an employer or a government program or by buying their own policies. In return, insurance companies would be prohibited from turning away the sick. Government would subsidize premiums for millions now uninsured.

The law’s opponents argue that Congress overstepped its constitutional authority by requiring citizens to obtain coverage. The administration says the mandate is permissible because it serves to regulate interstate commerce. A decision is expected in late June.

The federal insurance mandate is modeled on one that Massachusetts enacted in 2006 under then-Gov. Mitt Romney. That appears to have worked well, but it’s unlikely states would forge ahead if the federal law is invalidated because health care has become so politically polarized. Romney, the likely Republican presidential nominee, says he’d repeal Obamacare if elected.

That would leave it to employers, who provide coverage for about three out of five Americans under age 65.

“With or without health care reform, employers are committed to offering health care benefits and want to manage costs,” said Tracy Watts, a senior health care consultant with Mercer, which advises many large employers. “The health care reform law itself has driven employers, as well as the provider community, to advance some bolder strategies for cost containment.”

First, employers would push harder to control their own costs by shifting more financial responsibility to workers.

Data from Mercer’s employer survey suggests that a typical large employer can save nearly $1,800 per worker by replacing traditional preferred provider plans with a high-deductible policy combined with a health care account. “That is very compelling,” said Watts.

It won’t stop there. Many employers are convinced they have to go beyond haggling over money, and also pay attention to the health of their workers.

“As important as it is to manage the cost of medical services and products, and eliminate wasteful utilization, there has been a strong recognition that ultimately healthier populations cost less,” said Dr. Ian Chuang, medical director at the Lockton Companies, advisers to many medium-size employers. His firm touts programs that encourage employees to shed pounds, get active or quit smoking.

Employer health plans were already allowed to use economic incentives to promote wellness, and the overhaul law loosened some limits.

We’re borrowing a concept that was central to the health care law and bringing it into the private sector. Whether the law survives or not, the concept is still valid.  A Towers Watson survey found that 35 percent of large employers are currently using penalties or rewards to discourage smoking, for example, and another 17 percent plan to do so next year. The average penalty ranges from $10 to $80 a month, but one large retailer hits smokers who pick its most generous health plans with a surcharge of $178 a month, more than $2,100 a year.

Overall, one of the most intriguing employer experiments involves setting up private health insurance exchanges, markets such as the health care law envisions in each state. Major consulting firms such as Mercer and Aon Hewitt are developing exchanges for employers.

As under the health care law, the idea is that competition among insurers and cost-conscious decisions by employees will help keep spending in check. Aon Hewitt’s exchange would open next January, with as many as 19 companies participating, and some 600,000 employees and dependents.

“The concept of an exchange does not belong to Obamacare,” said Ken Sperling, managing the project for Aon Hewitt. “We’re borrowing a concept that was central to the health care law and bringing it into the private sector. Whether the law survives or not, the concept is still valid.”

As the Holiday Season is upon us, we find ourselves reflecting on the past year and on those who have helped to shape our business in a most significant way. We value our relationship with you and look forward to working with you in the year to come.

We would like to thank you for contributing to the success of our company and helping to make it one of the top Financial Services and Insurance Brokerage Firms in the Northwest. We have some great programs launching in early 2012 to assist you in your financial success and some exciting offers lined up for you. Next time, when questioning your financial future and how to protect you and your family, please keep us in mind. As always we are at your service. We wish you a very happy Holiday Season and a New Year filled with peace and prosperity.

Our heartfelt best wishes to you and your family.

Sincerely,

Ralph Van Winkle

With the holiday season almost upon us and 2012 quickly approaching we wanted to take this opportunity and address some insurance related issues that a new calendar year always brings up. Whether you have an individual or employer sponsored Health Insurance plan, a Life insurance policy, Dental and Vision plan, or some combination thereof, here are a few things to keep in mind as we close out 2011 and usher in 2012.

Health Insurance:
For most policies, your Medical plan’s deductible (or copay maximum amounts for HMO plan holders) and maximum out-of-pocket limits are based on a calendar year regardless of when your coverage became effective. All deductibles, copays, and out-of-pocket maximum amounts will therefore be renewed on January 1, 2012. If you are unsure about your policy please refer to your policy booklet or call our office.

Dental and Vision Insurance:
If you have Dental insurance, your deductible and annual benefit maximum(s) also most likely follow the calendar year and will reset January 1, 2012. If you have Vision insurance this is the only set of benefits that track to your last date of service. For example, if you visited a provider on March 15th of 2011, and your plan provides for an exam every 12 months, you would be eligible for another exam after March 15th 2012.

Health Savings Accounts (HSA):
As set forth by Congress and the IRS, the annual HSA contribution maximums will be changing for 2012. Individual contribution maximums will increase by $50 and Family contributions by $200. If you are age 55 or older your catch-up contribution will remain $1,000.

2012 HSA Limit for Individual Coverage

The 2012 maximum annual amount that can be contributed to an HSA is $3,100 for an individual, up $50 from $3,050 in 2011.

2012 HSA Limits for Family Coverage

The 2012 maximum annual amount that can be contributed to an HSA is $6,250 for families,  up $100 from $6,150 in 2011.

2012 HSA Limits for Catch-Up Contributions

Persons over age 55 are entitled to an additional annual catch-up contribution of $1,000 in 2012—a number that unchanged from 2011.

Remember, you have until April 15th 2012 to make your 2011 HSA contributions. If you have any general questions about HSA account funding please call our office at 800-570-6333 or send us an email at info@vanwinkleinsurancegroup.com

Life Insurance:
If you have an existing Life insurance policy it is a good time to review the coverage and make sure the policy fits your current needs. If you have bought or sold a business, gotten married, had children, bought a house, or if any number of other important life events have take place since purchasing your policy, you may be under or over insured. If you don’t currently have any Life insurance, start 2012 off right by protecting your family and the ones you love with a Life insurance policy. The process is easy and rates are very reasonable.

Finances:

If you currently have investments and close to retirement or in retirement, please contact your financial advisor for end of the year planning. Find out if you could potentially alleviate any burdensome tax bills and investment shortfalls by investing in 2011 vs. 2012.

Ancient Egyptians built the pyramids as a process of life. They felt the steps to greatness could be achieved through dedication and as a community built over 100 pyramids still standing today. Its the structure and stability that provides the ability to weather all storms.

A similar concept—a financial pyramid—offers a model for financial stability and health. The base tier of the pyramid represents the foundation of a sound financial plan. The function of this tier is to “guard against life’s uncertainties,” primarily with insurance. This includes life and health insurance, disability insurance, long-term care, homeowner’s and auto insurance. With adequate coverage, a family can be protected against unexpected occurrences in life that might otherwise create a financial hardship. Another key element of the foundation is having adequate “cash on hand” in case of an emergency. This includes your regular savings accounts and money market funds —in fact, any type of account that allows easy access to your money, penalty-free. The goal is to have a cash reserve that is equal to three, and preferably six, months of expenses.

Additionally, you should have a will for both you and your spouse. Your insurance or financial advisor will be glad to give you the names of local attorneys who specialize in wills and estate planning. The second level involves “growing money”

through investment. Here, you want to make sure your plan includes the practice of diversification. Today, many people invest in mutual funds, which by their definition are diversified and professionally managed. However, there are other investments and tactics to consider when building a successful portfolio. Your best bet is to review your
desires and goals with a professional financial advisor.

The third tier of the pyramid addresses how to manage your retirement and how to protect and distribute your estate. This can be achieved with an estate plan and other advanced planning strategies, including trusts and updated wills. Once again, conferring with a financial advisor or an estate planning professional is advisable. Their
expertise and guidance can help ensure that your estate is managed according to your desires and goals.

Here’s good news about life and health in the U.S. today:

The average life expectancy, which was 65 about 50 years ago, is now well over 70. What’s more, the older you get, the older you’re likely to get. Once you reach 65, you can expect to live another 18.4 years. If you make it to 75, your life expectancy increases to 86.8.

What that means, for many, however, is that getting long-term care insurance can be a good idea.
Long-term care includes a wide range of medical and support services for people with a degenerative condition (i.e. Parkinson’s or a stroke), a prolonged illness (cancer) or a cognitive disorder (Alzheimer ’s). Most people need such care in their later years, but younger people can need it, too, due to accidents or illnesses.
The care can be provided in many settings including nursing homes, your own home, assisted- living facilities and adult day care. Almost half of all long-term care insurance benefits pay for home care. The care is not only chronic care but involves assistance with daily living, dressing, eating, traveling and housekeeping. Full-time, this can become very expensive; that’s why you need insurance.

Important Things To Know

• You must health qualify for long-term care insurance. Not everyone can. Because health changes, especially as you age, it’s smart to look into this well before you reach retirement age (your 50s are generally a good time to start, but definitely before 65).
• Long-term care insurance can be far more affordable than you think. There are many ways to make this protection affordable.
• Rates (premiums) can vary significantly from one insurer to another. Speak with a knowledgeable professional to get the best protection for the best rate.
• Health qualifications can also vary from one insurer to another. Be prepared to share information with an insurance professional.
• You’re only going to buy long-term care insurance once. It’s almost never economically advantageous to switch, primarily because costs are based on your age at application.

Mistakes To Avoid

• Waiting too long to start planning. The sooner, the cheaper.
• Believing it won’t happen to you.
• Counting on government programs.
• Not working with a long-term care insurance professional.

Learn More
If you have a relationship with a financial planner or other financial professional, you can ask for referrals to a long-term care insurance specialist. If you need to find a professional or if you’d like more information, you can contact us and we will put you in contact with a trusted source in your area.

Happy Thanksgiving from all of us at Van Winkle Insurance Group

 

May you have many things to be thankful for this holiday season!

Here is a list of changes that are coming in 2012. For the most part Health Insurance will not change if you are not effected by Medicare.

Health Care Reform 2012: Medicare

• Make Part D cost sharing for full benefit dual eligible beneficiaries receiving home and community based care services equal to the cost sharing for those who receive institutional care.
• Allow providers organized as accountable care organizations (ACOs) that voluntarily meet quality thresholds to share in the cost savings they achieve for the Medicare program.
  
  

• Reduce Medicare payments that would otherwise be made to hospitals by specified percentages to account for excess (preventable) hospital readmissions.
• Establish a hospital value based purchasing program in Medicare and develop plans to implement value based purchasing programs for skilled nursing facilities, home health agencies, and ambulatory surgical centers.
• Provide bonus payments to high quality Medicare Advantage plans.
• Reduce rebates for Medicare Advantage Programs

Health Care Reform 2012: Other Changes

• No other 2012 health care reforms are planned based upon the original law.

For More Information

“Focus on Health Reform: Health Reform Implementation Timeline,” The Henry J. Kaiser Family Foundation.

The Center for Disease Control released some disturbing facts about the state of U.S. Heath. Here are just a few facts…

• 1 in 10 Individuals has Diabetes and is expected to increase to 1 in 3 by 2050
• Only 71% of individuals with Diabetes are diagnosed making 29% unaware of the disease
• Diabetes and Hypertension is the #1 costliest conditions to employers because of healthcare cost, lost workdays, and lost productivity.
• Eye Disease cost more to consumers each year than Lung Cancer, Breast Cancer and Brain Cancer combined.
• Heart Disease is the number one cost to consumers.
• 70% of Americans die from Chronic Illness from Diabetes, Cancer, or Heart Disease.
• 1 in 7 Americans exercise on a regular basis

Four Common Causes of Chronic Disease

Four modifiable health risk behaviors—lack of physical activity, poor nutrition, tobacco use, and excessive alcohol consumption—are responsible for much of the illness, suffering, and early death related to chronic diseases.

• More than one-third of all adults do not meet recommendations for aerobic physical activity based on the 2008 Physical Activity Guidelines for Americans, and 23% report no leisure-time physical activity at all in the preceding month.

• In 2007, less than 22% of high school students and only 24% of adults reported eating 5 or more servings of fruits and vegetables per day.

• More than 43 million American adults (approximately 1 in 5) smoke.

• In 2007, 20% of high school students in the United States were current cigarette smokers.

• Lung cancer is the leading cause of cancer death, and cigarette smoking causes almost all cases. Compared to nonsmokers, men who smoke are about 23 times more likely to develop lung cancer and women who smoke are about 13 times more likely.

• Smoking causes about 90% of lung cancer deaths in men and almost 80% in women. Smoking also causes cancer of the voicebox (larynx), mouth and throat, esophagus, bladder, kidney, pancreas, cervix, and stomach, and causes acute myeloid leukemia.

• Nearly 45% of high school students report consuming alcohol in the past 30 days, and over 60% of those who drink report binge drinking (consuming 5 or more drinks on an occasion) within the past 30 days.

• A large number of studies provide strong evidence that drinking alcohol is a risk factor for primary liver cancer, and more than 100 studies have found an increased risk of breast cancer with increasing alcohol intake. The link between alcohol consumption and colorectal (colon) cancer has been reported in more than 50 studies.

Depressed? Me too!

We spend money to buy something for the satisfaction of possessing it. But life insurance is a product we can’t see, can’t touch, and in most cases can’t enjoy it in our lifetime. Why should we buy life insurance then?

1Protect your family and assets

This is the main reason people buy life insurance.  What would happen if you die today? What will happen to all your debt? What will happen to your kids financial well-being that they rely on you to provide. We work hard in our whole life to increase our value and do not want to loose everything you worked for if you pass away. Only two things are certain in life – death and taxes. In death, life insurance will be our wealth creation tool to instantly generate the cash we could have earned to take care of our family and loved ones.

2Show your love to your family

“We love because it’s the only true adventure.” – Nikki Giovanni

This is the statement that will usually gets individuals to roll their eyes when you say it. Talk to any family that has had a  loss of a family member and their loss of income was replaced with life insurance. Your family can tangibly see that you took the right steps to ensure your families security. If love and life is indeed an adventure, life insurance becomes the safety net.

3Our health is deteriorating everyday

Do you know anyone who is getting healthier everyday? By the time he is 100 years old, he is at the peak of his health condition. He can live on forever! Gosh, people are getting older and this is an undeniable and unstoppable fact. Our health is deteriorating every minute. We never know the exact time a disease will strike us. Fear of illnesses motivates people to buy life insurance.

4Practice the habit of forced savings

When we face the shortage of cash, withdrawing money from our life insurance policy is always the last resort. In the fear of losing the life insurance policy, we are forced to make the regular premium payment. In the long-term, life insurance is a great saving tool. It forces us to save for the future, and also for the unforeseen disaster. Included with that is the ability to overcome the opportunity loss.

5Funding a trust

A trust is an arrangement under which one person, called a trustee, holds legal title to property for another person, called a beneficiary. The cheapest way to fund a trust is using life insurance. The cost of premium is only a few percentage of the trust fund we intend to create. This will allow a tax-free trust account that you can pass on to desired relatives.

6Funding a business operation

An employer takes out an insurance policy insuring against loss of profits arising from the death, sickness or injury of a key employee. The beneficiary is the employer. The life insurance policy bought is known as key-person policy. The insurance payout will be used as emergency fund for business operations.

7Funding Buy-sell agreement in partnership business or corporation

Every co-owned business needs a buy-sell agreement the moment the business is formed or as soon after that as possible. Every day that value is added to the business without a plan for future transition, it increases its financial risk. What happen if one of the partners decided or forced to exit the business? The most common triggering events are dispute, death, disability and retirement. Life insurance can be used to fund purchases of the deceased shares in the event of death.

8Charity

A charitable trust is a trust established for charitable purposes. Charities may take the form of charitable trusts, companies or unincorporated associations. Some wealthy entrepreneur buy life  insurance to fund their charitable trust tax-free. This will allow their estate to pass on a substantial amount to their desired charity upon death.

9Funerals are Expensive

The average funeral will cost from $6,000-$12,000 based on a 2009 study of U.S. burial cost. That does not include any additional cost of probate proceedings and you hiring a legal or financial representative to guide you through the process.

10It Makes Financial Sense

Life insurance is considered a financial asset, which can help increase your credit, get loans for homes, business, cars and a multitude of other financial needs. Many policies have cash value, which even in case of bankruptcy cannot be touched by creditors. This is why it is important for you to find the right agent for you. Make sure your Life Agent or Broker explains each product in a manner that is understandable. Agents tend to have the way of taking about insurance with big words like “actuary” or “indemnity.” These are words that can be simply stated but rarely are. If you have questions make sure you ask them or drop us a line and we will be more than happy to clarify an issue.