Telemedicine and High Deductible Health Plans (HDHPs): The Full Story

Telemedicine and High Deductible Health Plans (HDHPs): The Full Story

What is Telemedicine?

Before we talk about High Deductible Health Plans (HDHPs) and why telemedicine is treated differently under those plans, let’s discuss what’s telemedicine. Telemedicine, what we call a more consumer-friendly “online medical consultations,” is the ability of medical professionals to evaluate, diagnose and treat patients through the use of  telecommunication technology (via video or audio only.) This approach has been growing in the last decade with the release of the iPhone and as a report from Business Insider says “Many believe that 2018 could be the tipping point” for the technology.

Over 70% of all traditional medical visits can be handled via telemedicine and consumers are getting more comfortable with using it. Online consultations, as an alternative to in-person visits, have a bunch of advantages:

  • Nearly instant consultations – The average consultation through HealthJoy happens within ten minutes with no appointment necessary.

  • No or low cost – Telemedicine has little to no cost to HealthJoy members and helps employees avoid costly ER and urgent care visits, saving companies money.

  • No travel time – No Ubers, trains, driving, or gas – members get on-demand access right from their mobile phone, anytime, anywhere.

  • No germ-filled waiting rooms – According to the Journal, Infection Control, and Hospital Epidemiology, you’re more likely to get sick after visiting a doctor’s office, but I’m sure you have always suspected that.

  • Less time from work – A report from the American Journal of Managed Care says it takes 121 minutes each time someone seeks medical care. The total includes 37 minutes of travel time, and 87 minutes at the doctor’s office. Total time with the doctor is only 8 minutes.

  • Easier on your life – Telemedicine has less interference to people’s life – specifically elder or child care responsibility. Not to mention that the wait time for a new patient-physician appointment has risen to an average of 24 days.

There has been an exponential increase in the number of employers that offer telemedicine as part of an employees benefit package. These programs are usually offered as either as a single point solution (these have lower utilization) or as part of a healthcare guidance platform (like HealthJoy.) These programs can save both the employer and employee time and money by routing care from expensive facilities like urgent care and emergency rooms.

What’s the deal with Telemedicine and High Deductible Health Plans (HDHPs)?

Well, the government being the government, they have created a bit of confusion when it comes to employers offering HDHPs that qualify for health savings accounts (HSAs) and telemedicine. The issue stems from providing a telemedicine plan with zero or at a low cost could render an individual ineligible to receive or make contributions to their HSA. This is a known issue by the community, and the IRS is aware there is a problem but has not committed to issuing guidance on it. Also, no law firm will issue a legal opinion on the matter due to the vagueness of the rules. As it stands, you can’t cover people with HSAs under any “disqualifying coverage.” This includes any provided healthcare coverage before meeting the HDHP deductible; people refer to this issue as the “first dollar coverage” issue. The IRS does allow exceptions for some coverage including; “permitted insurance,” “exception benefits,” discount cards, employee assistance programs, and preventive care. Having telemedicine alone as a part of a benefits package won’t disqualify an employee but to be safe, most telemedicine providers recommend a per visit fee for those users that are HDHP eligible. As to the dollar figure of that fee, that is the big unknown. HealthJoy doesn’t have a recommendation about exact dollar amounts, but it’s program has flexibility to accommodate any amount on a per client basis and can share general information about what it is seeing across its client base in terms of HDHP telemedicine fees. Until there’s more government clarity, we will remain flexible. For non HSA eligible plans, we offer free telemedicine service at part of our service.

What’s in store for the future?

This summer, the House of Representatives passed two bills that could change the way employees can use their HSAs. These bills have been supported by both parties and are seen as an improvement to the existing law. In reference to telemedicine, they would allow HDHPs to cover preventive care outside the deductible. We are still waiting for the Senate to pass their version and then those bills will need to go through reconciliation. However, we are hopeful for more clarity on the issue that would enable us to offer free consultations to all HealthJoy members, which we fully support.

How AI is Impacting Healthcare & Employee Benefits

How AI is Impacting Healthcare & Employee Benefits

It seems that everyone these days is throwing around the terms “artificial intelligence” and “machine learning.” Companies without a single programmer on staff are issuing press releases touting artificial intelligence (AI) as if the term were fairy dust that could magically improve their product. But what are AI and machine learning, and how is it impacting healthcare and employee benefits?

These technologies are rapidly changing industries, and the productivity implications are profound. According to a report by PWC, global GDP will increase 14% by 2030 – an additional $15.7 trillion – due to the integration of AI. Before we go into how AI is impacting employee benefits, let’s discuss what AI and machine learning are.

What are AI and Machine Learning?

With traditional methods of programming, you write instructions for a computer to process input, and the computer produces some output. For example, a car insurance company might calculate your rates by getting input about your driving history, age, car type, zip code and more. The program will then take this input and estimate risk based on the instructions provided and give you the cost of your insurance. With a machine unsupervised learning model, you wouldn’t give a computer a specific set of instructions but instead provide old application data with resulting claims data. The computer would then figure out risk probability and price it accordingly. This learning model would continue to get better over time with more data coming in.  

Machine learning is a type of AI that was created to help analyze massive data sets that would be impossible for a human to work on alone. Machine learning is self-improving, so the results get better over time as more data becomes available. This is one of the reasons that companies like Facebook are investing in these technologies; they want to improve advertising targeting based on likes and interests.

AI is a broader concept that involves machines performing different tasks that are characteristic of human intelligence. This would include things like understanding language (NLP), recognizing objects (CNN’s), general problem solving and learning.  Programmers categorize AI as either general in scope or narrow. General would involve all the functions mentioned above in one grand program while narrow is a more focused use of the technology. These days, the use of narrow AI is more common as programmers want to limit the scope of a project. People select specific tasks to make more intelligent and look to make incremental improvement.

How AI is Impacting Healthcare Today

With the hype around AI, people seem to expect a momentous business change to happen in an instant. This might occur in specific cases like medical imaging, which is a perfect narrow problem for AI to solve, but in general AI is going to have a significant impact as a series of smaller changes that will add up to something more meaningful. Here are a few changes we are seeing today that are impacting employee benefits and healthcare:

  • Customer service – We use AI with our in-house, custom-built member relationship management system that our healthcare Concierge use every day. Our AI system can make text chat recommendations, which our Concierge can select and edit as needed, to speed up service. The AI makes recommendations based on claims data, if available that the Concierge should be aware of. In one situation, AI saves a few seconds when we are providing service. In the other, it helps us improve the quality of our service.
  • Claims Analysis – Every time a member uses their health insurance, there is more insight to be derived from their total claims data. This claims data is perfectly suited to analysis by AI. Medical and Rx claims, biometric screening, and onsite clinic information can all be analyzed to understand someone’s health and provide possible recommended action. For example, if a member has been on a medication for years and a generic alternative comes into the market, our system might recommend a switch to save money.
  • Member experience – Virtual assistants like Siri, Alexa and JOY all use artificial intelligence to deliver their experience in many different ways. Our application uses machine learning when processing photos and visual information. We continue to invest in R&D to add AI to more functionality and improve our experience.

  • Eligibility files – We’ve talked about how we are using AI for eligibility file management in BenefitsPro in the past. Dealing with large imports is the perfect use case for AI.

Healthcare is complex with many moving parts. Adding AI will improve each area incrementally, and the sum of these improvements will lead to huge leaps in productivity. We are striving every day to streamline things for our clients, resulting in better service at lower costs.

Why It’s Critical To Have Medical Bills Reviewed

Why It’s Critical To Have Medical Bills Reviewed

It may feel like second nature to review your cell phone, credit card, and internet bill for mistakes. Reviewing your medical bill, however, often feels like a near-impossible task. They are notoriously indecipherable and written with confusing codes, leaving you unsure of what you’re being charged for, how much is due, and where to get help. Even though you’re well aware of today’s inflated medical prices, trying to double-check your bill can be so confusing that it’s easier to pay the charges as long as they’re not grossly unreasonable. By doing so, however, you’re highly likely to be paying for services you never used, visits you never had, and many other flukes. The vast majority of medical bills contain some errors, deeming having medical bills reviewing a necessary step for all patients. Although there hasn’t been a comprehensive study on medical bills, Professor Stephen Parente, of the University of Minnesota has studied medical billing and estimates that 30% to 40% of bills contain errors.

What’s Wrong With Healthcare Billing?

Because of the variation in healthcare coverage between different insurance carriers, there is no such thing as a typical medical bill. For this reason, medical bill errors are not systematic or predictable. They may occur as duplicate charges, charges for canceled procedures, balance billing, and upcoding, where they charge you for a more serious/costly procedure than the one you received. All of these are due to the complex coding system that is used by providers to classify diseases and procedures. This code makes it easy to make mistakes, miscommunicate, and end up inputting a code for a more expensive procedure.

Still, other issues arise from purely administrative errors, like having typos or incorrect patient information or sending the bill to the wrong insurance company. Both can result in insurance companies rejecting the claim, leaving employees with an unaffordable bill. We see these issues every day.

Luckily, there is a foolproof remedy to combat these types of costly mistakes. The easiest way to protect employees and their wallets from inaccurate medical charges are to have a service that reviews and negotiates bills on their behalf. Sure, you can teach employees how to search for billing errors on their own, but the process is so tedious and time-consuming that it would undoubtedly lower their productivity at work. Most people prioritize health and wellness over their job, thus securing employee’s healthcare services and costs is a necessary precursor to maintaining fully engaged workers. There are countless advantages offered by a medical bill review service– ROI and peace of mind are just the beginning.

Negotiating out-of-network fees

It’s a common practice for insurance carriers to perform “backroom deals” with particular doctors and hospitals to negotiate favorable rates in return for directing patients to their services. What results is a configuration of “in-network” and “out-of-network” providers, unique to each insurance carrier. Receiving care from an out-of-network provider comes with costly financial consequences since insurance carriers are trying to make it as hard as possible for patients to leave the network.

If you’ve seen a doctor that happens to be out of your insurer’s network, then you’ll most likely find yourself with a ridiculously steep medical bill. Luckily, the story doesn’t have to end there. Outrageous out-of-network fees can be negotiated down to reasonable levels. Many providers expect that their fees will be discounted and negotiated, so it is up to the consumer and the bill review service to do act on a bill that is higher than expected. Medicare payouts provide a baseline that can be a starting point in negotiations since they are public and widely accepted – even by the provider doing the billing sometimes.

A bill review service can help you do so by making a convincing argument for your case to be paid at an in-network rate. Health plans are open to negotiation, but the reality of this process is that it’s time-consuming and involves phone calls, emails, and letters to be sent back and forth with the carrier. It is much easier to leave this process to a team of experts, who have the experience and know-how that is necessary for working with medical providers and carriers to achieve various discounts and deals within a contract.

Room for Negotiation

An advocacy service can use several strategies to negotiate to pay for out-of-network care at in-network rates. First, they can discuss a patient’s cost-sharing, which includes their deductible and coinsurance rates. Deductibles are usually higher for out-of-network care. Besides, the money you contributed to an in-network deductible may not count towards the out-of-network deductible, meaning you have to start from scratch when purchasing care from an out-of-network provider. Negotiating to pay for care at in-network deductible and coinsurance rates can, therefore, contain costs significantly.

Secondly, they can challenge “balance billing” practices, which many health plan contracts prohibit. Balance billing is when a medical provider bills you for charges that your insurance carrier did not cover. This often occurs because the price for a procedure surpasses what insurance carriers deem reasonable and customary for that given procedure. Because of carriers’ refusal to pay bills exceeding a certain amount, patients end up having to pay a sizeable out-of-pocket bill. Healthcare advocacy services will help patients by re-negotiating what is “reasonable” for the carrier to cover and will work with the care provider to settle on a lower cost for the procedure.

Getting Medical Bills Reviewed is Effortless for Patients

In the smartphone era, saving money through medical bill review is as quick and easy as taking a picture with your phone camera. Fax machines and scanners are unnecessary when you can complete the entire process with your smartphone’s camera and an app.

With medical bill review in today’s world, a patient submits their bill to an advocate immediately after they find a higher than expected medical bill. A medical bill expert will then review the information and set up a consultation with the patient. During this discussion, the concierge will help the user understand the situation and will collect more information from them if necessary. When it appears that a billing error occurred, the concierge begins the negotiation process with providers on the patient’s behalf. They don’t stop until they have a revised bill or a clear explanation of charges. This process may entail calling the carrier, the provider, and the central billing office. Frequently, multiple calls to each of these parties are required, meaning the patient saves hours by entrusting the negotiation process to the support team.

Using a medical bills reviewed is the simplest way to ensure employees aren’t overpaying for medical care. Whereas traditional services will have an employee fax, scan or email a medical bill for review, modern advocacy platforms will make the process quick and easy. Once employees realize how painless the process of lowering their medical bill is, there will be little stopping them from using the service. Finally, medical bill review services will reach out to members and recommend that they consult the service prior to future visits so that they can be steered towards the most cost-effective care decisions and avoid excessive fees. The best way for a patient to make educated care decisions, after all, is to be fully aware of the cost of care before using the service.

Because a medical bill usually brings up more questions than it answers, having an expert advocating on your behalf can be the difference between a bank-breaking fee and a reasonable, predictable expense. Medical billing services at part of a healthcare guidance platform make things simple and easy for members to use.

What Workers Really Want from Employee Benefits

What Workers Really Want from Employee Benefits

If you ask today’s job hunters to describe what they want from employee benefits in three words, they might say; flexibility, mobility, and security. The job market of today is becoming more diverse and increasingly occupied by millennials. The latest wave of employees isn’t satisfied by default, cookie-cutter benefits package that a company has been offering for years. When compared to past decades, job hunters today have a vastly different mindset not only in how they define work but also regarding what they expect from their workplaces. They are prioritizing benefits, wellness, and culture, instead of the than the straightforward and traditional prioritization of income. This is a generation that is ever-so aware that money doesn’t buy happiness. Glassdoor reports 4 in 5 workers prefer more and better employee benefits to a pay raise.

Even as job seekers’ mindsets are shifting, keeping HR on their toes, one thing remains constant: health insurance is the number one most-valued employee benefit. By understanding today’s evolving labor market as well as why health insurance continues to be the most desired benefit, HR strategists will finally be able to design a benefits package for their employees that fits just right. After all, tuning into what employees want from benefits may provide the advantage employers need to win the best talent in the market.

Job Seekers Desire Flexibility and Mobility

By 2020, the bulk of the working population will be millennials and three-quarters of U.S. employees will be part of the mobile workforce. The rise of a digitally connected workforce has led to an increased ability and desire to break out of the traditional 9-to-5 work-day spent in a cubicle. Mobility has led people to champion things like remote work, flexible hours, and paid time off.

Convincingly, the aforementioned Harvard Business School study reveals that the next four priorities on the job seeker’s list following health insurance are more flexible hours, more vacation time, work-from-home options, and unlimited vacation, respectively. It’s noteworthy that 4 of the top 5 most-valued employee benefits all have to do with workplace flexibility.

This desire for flexibility shows that our lives are being reshaped by mobile technology. We store our thoughts, information, and files in the cloud and access them on demand with ease. We feel empowered by the unlimited knowledge available at our fingertips through the Internet. We are the information generation, where knowledge is transmitted with incredible ease and communication happens instantaneously. It only makes sense that workers no longer feel the need to be constantly chained to their office desktops to get their work done. No matter where an employee chooses to work, the gift of flexibility enables them to achieve increased productivity.

Why Health Insurance is Still the Number One Employee Benefit – Security

Despite all the hype about free food, massages, or fitness classes, a Harvard Business Review study finds that health insurance is still the most desirable employee benefit of job seekers today.

This fact should come as no surprise. The rising and unpredictable costs of healthcare make employee health benefits a clear choice and priority. People fear the unknown, and the cost of healthcare is unknown in several ways. Not only is it hard to find the exact prices of healthcare services and treatments, but the state of one’s health, as well as healthcare policy in the U.S., are equally unpredictable. Healthcare affects people’s lives financially, emotionally, and physically, and it is slowly but surely becoming unaffordable to purchase coverage on one’s own. For these reasons, robust healthcare benefits are a priority for job hunters looking for their next employer.

Adding Flexibility and Mobility to Health Benefits

Employees are no longer happy with the typical carriers health benefits experience. Their expectations have changed, they want on-demand help, access to online doctors and all their benefits accessible right from their mobile phone. Companies that add on-demand healthcare guidance are the ones that will win the talent war. With unemployment at historic lows, can your company afford not to provide the best in employee benefits?

How Does Captive Insurance Work and What are the Benefits?

How Does Captive Insurance Work and What are the Benefits?

Common Misconceptions About Captive Insurance

Captive insurance and the way firms advertise it can seem mysterious. In reality, captives are not all that different from self-insuring. By creating and owning its own captive insurance company, any firm can insure the health risks and other unknown expenses of their employees. In doing so, firms reap countless benefits, from greater flexibility in risk management to earning additional income through the savings and interest accrued from the captive. There is a host of misunderstandings that surround captive insurance companies. We’ll look into common false impressions and help you separate reality from myth.  

Are captives only worthwhile for large companies?

Decades ago, the IRS tax code for captive insurance companies, 831(a), was geared towards large corporations with annual premiums over $2.3 million. More recently, however, tax code 831(b) was created to acknowledge the growing middle-market and encourage small and midsize companies to participate in captives. Known as the “micro-captive” tax election, 831(b) is available to businesses that collect $1.2 million or less in underwriting profit. Under this election, insurance companies enjoy a 0% tax rate on their underwriting profits. While historically it might have been the case, it’s no longer true that large corporations are the only ones who can benefit from forming a captive.

With declining capital requirements and operating costs, captives are now accessible to smaller companies. Online platforms enable many companies to get off the ground using limited capital, which frees up potential resources that they can use toward a captive. Given the volatility of a small private company, where a single catastrophe can lead to ruin, and there are no shareholders to fall back on, captives are an excellent way to build up capital and allow business owners to manage their risk.

Nevertheless, it’s always important to make sure captive insurance is a good fit for an individual company. A substantial amount of initial capital is required to ensure financial stability during a crisis and have an adequate amount of reserves available. For this reason, a common practice for small and midsize companies is to band together in a coalition of several employers. By doing so, they can mimic the volume of a large company and engage in risk-sharing while enjoying all the benefits of captive insurance.

Are captive insurance companies main goal to lowering taxes?

Even though much of the discussion on captives is about tax breaks, this legal aspect is just a single piece of the puzzle. Every business owner has their own set of reasons for starting a captive insurance company, and being tax-advantaged is only one of them. Some of the many reasons a company might open a captive are:

Improved risk management: By building up a reserve of cash through a captive, companies can design it to pay whichever costs they desire. No more random fluctuations in the insurance market – with a captive, you get a fully transparent view of your risks and claims, and you decide how best to manage them.

New revenue streams: Not only do you get to see where the money’s going when you have your own captive insurance company, but you also get to recapture the profits that outside insurance carriers would typically enjoy. You even get to keep all of the income accrued from savings and interest, meaning a captive can eventually start making money for a company rather than purely being an expense.

Access to reinsurance markets: While a single captive alone can only provide a limited amount of coverage, it can access the reinsurance market to underwrite its risk. Reinsurance providers offer increased coverage capacity and are less costly than attaining reinsurance through a commercial carrier.

A centralized platform for managing diverse risk operations: a captive can serve as a streamlined information center for managing different risks from various areas of a business. That way, companies can use innovative strategies like transferring risk from one balance sheet to another, which allow them to exert more control over their financial resources.

Coverage for special risks and government programs, such as equipment failure, pollution liability, and terrorism insurance, which are generally unavailable and/or unaffordable in traditional commercial markets.

Do Captives Suffer from Negative PR?

Despite media hype around the captive-related practices of Fortune 500 companies, well-regulated captives are legitimate, compliant insurance companies. While some captives are indeed located in foreign countries like Bermuda and the Cayman Islands, an increasing portion are being established domestically, especially in Vermont, Utah, and Delaware. News outlets often highlight big-name companies who were found to be using offshore accounts as tax shelters, albeit in a lawful manner. It would be misinformed to view captive formation through the lens of big-business financial practices, however. While they offer good fuel for sensationalized headlines, they are not a good representation of a captive’s true purpose.

Captives operate under the Internal Revenue Code sections 831(b), 831(a) and 501(c)(15), allowing their owners to be recognized as U.S. taxpayers. In reality, there is nothing “phony” about a captive insurance company that is formed legitimately under the US tax code. Therefore, the IRS will not crack down on a fully-compliant and well-managed captive unless they find a legitimate reason to hold them accountable.

Captive Myths Busted!

The bottom line on captive insurance is that it gives a business full control, transparency, and profit when it comes to their risk management. They are certainly not exclusive to large firms, solely a tax savings tool, or illegal by any measure.

Captives are pushing companies of all sizes to look inwards and ask themselves, “do you own your risk?” If not, it probably means that a third-party insurance carrier is profiting from it. They empower business owners to control their company risk, instead of paying an insurance firm to do who-knows-what with their premium dollars. Once businesses see their risks and claims as clear as day, they’ll notice the pitfalls in their employee’s spending decisions, such as choosing providers that overcharge them and not “shopping healthcare procedures”. Using a captive means they will have the information and flexibility to do something about it. They can nudge employees to better care options, and pinpoint areas for improvement.

At the end of the day, it’s a story about incentives. Large insurance carriers have an incentive to increase premiums and earn profits in the process. Your business, however, has the incentive to control costs and help your employees make better healthcare decisions for their health and finances. Now, no misconceptions will stop you from doing what’s right for your company.


Want to learn more? Watch a great video by Andrew Clayton, President – Pareto Captive Services at Cypress U

Most expensive drugs in the US for employers

Most expensive drugs in the US for employers

In a previous blog post, we investigated why drug costs are rising, and what employers and patients can do about it. It seems unbelievable, but the monthly cost of supplying some of these drugs costs more than the average car. Here are the most expensive drugs, listed in order of cost for a one-month prescription:

The most expensive drugs tend to be specialty drugs, which charge a steep fee for treating rare conditions except for Harvoni and Sovaldi which treat hepatitis C which affects an estimated three million Americans. Even if you don’t have a rare disease, however, it’s likely that you’re overpaying for your prescription. Prices of the same drug vary significantly between different pharmacies, so your local grocery store may not always be the best option. What’s more, even those with the best insurance packages may be able to get a better deal on prescriptions than their insurance copay amount. All this pricing madness is happening under your nose, and it can feel overwhelming to know where to begin searching for the best-priced drug.

Luckily, healthcare guidance platforms were built to help patients navigate the complicated pricing schemes we see today. Healthcare Concierge teams who perform Rx savings reviews can help you make the best of a tough situation. After scouring the market for generic alternatives, manufacturer’s coupons, mail order options, and much more, a prescription expert will secure the best price for your prescription. That way, you don’t have to do any of the grunt work that comes with saving money. Our prescription algorithm takes into account the following data to identify the best options:

  • Therapeutic alternatives
  • Manufacturer coupons
  • Prescription assistance programs
  • Our Rx savings program
  • Mail-order pharmacies
  • International mail-order drug programs
  • Pharmacy prices
  • Optimization of dosage
  • Generics

Our 9 point strategy delivers average savings for members of $65 per month per medication. This is the reason JOY; our artificial intelligence powered virtual assistant interacts with every member and asks about their present medications.