Senior Insurance News

University employees’ health insurance costs on the rise

Mon, 15 Aug 2011 17:32:00 GMT

By Elizabeth Hinojos

Health care premiums for employees of American higher-education institutions are on the rise, according to a survey, and the University of Texas is implementing a slightly higher premium for employees this year.

The College and University Professional Association for Human Resources surveyed 415 colleges and universities nationwide; of which 24 percent were private religious institutions, 28 percent were private institutions and 48 percent were public. UT did not participate in the survey.

The cost of the University‘s health care plan increased by a few dollars, according to the University’s Human Resource Services website. In terms of medical out-of-pocket cost for full-time employees, the cost of insurance for subscriber and spouse increased by $9.48 per month. The cost for subscriber and children increased by $9.91 per month, and the cost for subscriber and family increased by $18.66 per month.

“The increases are less for next year than I thought they were going to be, to tell you the truth,” said David Warner, a public affairs professor who specializes in health insurance and health finance.

There was talk during the most recent legislative session of substantial cuts in the amount the University would cover, Warner said. He said he expected there to be a much higher deductible or much higher premium compared to last year.

“Costs will have a relatively modest increase at least from the point of view of UT employees,” he said.

With health care costs on the rise, not all colleges are managing to extend benefits to partners and spouses of employees. Of colleges participating in the survey, 56 percent offer benefits to same-sex partners of employees, and 43 percent do so for opposite-sex partners, according to the Chronicle of Higher Education.

Samantha Perry, current chair of the Competitive Insurance Benefits Committee for the Pride and Equality Faculty and Staff Association, said the former chair had several talks with UT President William Powers Jr. last year regarding bereavement leave benefits.

“Leave policies are under final legal review with the University with sick and bereavement leave [included]. The policies are basically sitting on the desk of the administration [and have been] since last fall,” Perry said.

The issue the administration is citing is they’re getting budget cuts, she said, but the benefits the committee is asking for would let the partner pay money into the UT system for benefits. She said the committee’s only options are to ask for benefits and demonstrate that the University is losing faculty and staff and, eventually, students.

Keith Walters, an applied linguistics professor at Portland State University, and the former associate director of UT’s Center for Middle Eastern Studies, said in a 2008 report by the insurance benefits association that he left the University because “the administration had no interest in finding a way to provide benefits for the partners of lesbian and gay staff and faculty.”

Human Resource Services workers have written and submitted draft leave policies which are currently in the review process. This involves a review by a policy committee made up of employees from across campus. The draft will also require legal review and a review by the UT System, said Debra Kress, acting director for Human Resource Services.

“[Domestic leave] programs to support employees with family problems shouldn’t stop with a marriage certificate,” said Julien Carter, former associate vice president for Human Resource Services, to The Daily Texan in December 2010. “These safety net programs need to be expanded to cover modern definitions of what a family is. It comes down to issues of fairness and equity,”

Do You Know All About The Changes in Date Correction?

Mon, 13 Jun 2011 18:39:00 GMT

ATTESTATION OF ERROR – IMPORTANT UPDATE

The UnitedHealthcare regulatory department has reviewed CMS guidelines which prevent post-effective date corrections based on agent and/or consumer errors. As you are aware, it is the responsibility of the plan to follow CMS policies or risk non-compliance. For all identified agent selection and/or consumer selection errors, the following will apply:

MA/MAPD:

If the error is identified after the proposed effective date, a new application will be required, for the next available effective date, using current election eligibility.

If the error is identified prior to the proposed effective date:

Plan Selection Error - requires a new application, for the next available effective date, using current election eligibility.

Non-plan selection error - agent may submit an application change request form (copy attached) prior to the proposed effective date of the original application.

PDP:

No corrections can be made before or after the proposed effective date. All identified errors require a new application, for the next available effective date, using current election eligibility.

NOTE: These restrictions DO NOT apply to plan processing/plan data entry errors (including eModel). If the paper application shows an originalselection that was entered incorrectly, we can still request correction.

REGARDING PREVIOUSLY SUBMITTED REQUESTS:

Corrections which have been previously made and approved by CMS via retroactive processing request (RPR) will remain corrected.
Corrections which have been previously made, but have not yet been approved by CMS via RPR, MAY or MAY NOT be approved, and may be changed back to the original selections (matching the original error).

Why We Must End Medicare ‘As We Know It’

Mon, 06 Jun 2011 18:27:00 GMT

Almost everyone agrees that America’s health-care system has the incentives all wrong. Under the fee-for-service system, doctors and hospitals get paid for doing more, even if added tests, operations and procedures have little chance of improving patients’ health. So what happens when someone proposes that we alter the incentives to reward better care, not more care? Well, Rep. Paul Ryan and Republicans found out. No surprise: Democrats slammed them for “ending Medicare as we know it.”

This predictably partisan reaction — preying upon the anxieties of retirees — must depress anyone who cares about the country’s future. It is only a slight exaggeration to say that unless we end Medicare “as we know it,” America “as we know it” will end. Spiraling health spending is the crux of our federal budget problem. In 1965 — the year Congress created Medicare and Medicaid — health spending was 2.6 percent of the budget. In 2010, it was 26.5 percent. The Obama administration estimates it will be 30.3 percent in 2016. By contrast, defense spending is about 20 percent; scientific research and development is 4 percent.

Uncontrolled health spending isn’t simply crowding out other government programs; it’s also dampening overall living standards. Health economists Michael Chernew, Richard Hirth and David Cutler recently reported that higher health costs consumed 35.7 percent of the increase in per capita income from 1999 to 2007. They also project, that under reasonable assumptions, it could absorb half or more of the gain between now and 2083.

Ryan proposes to change that. Beginning in 2022, new (not existing) Medicare beneficiaries would receive a voucher, valued initially at about $8,000. The theory is simple. Suddenly empowered, Medicare beneficiaries would shop for lowest-cost, highest-quality insurance plans providing a required package of benefits. The health-care delivery system would be forced to restructure by reducing costs and improving quality. Doctors, hospitals and clinics would form networks; there would be more “coordination” of care, helped by more investment in information technology; better use of deductibles and co-payments would reduce unnecessary trips to doctors’ offices or clinics.

It’s shock therapy. Would it work? No one knows, but two things are clear.

First, as Medicare goes, so goes the entire health-care system. Medicare is the nation’s largest insurance program, with 48 million recipients and spending last year of $520 billion. About 75 percent of beneficiaries have fee-for-service coverage. If Medicare remains largely fee-for-service, the rest of the system will, too.

Second, few doubt that today’s health-care system has much waste: medical care that does no good; high overhead costs. In a paper, Cutler documented some evidence. In one survey, 20 percent of patients reported that doctors repeated tests because records were unavailable; the health-care sector has twice as many clerical workers as nurses and nine times as many as doctors; care of patients with chronic conditions is often slapdash, so that, for example, only 43 percent of diabetics receive recommended treatment.

Fee-for-service is open-ended reimbursement; the government’s main tool to control Medicare’s costs is to hold down reimbursement rates. Doctors and hospitals respond by ordering more services to offset the rate limits. For all its flaws, say Ryan’s critics, this system beats his. Indeed, the Congressional Budget Office has estimated that in 2022, Ryan’s plan would be more than a third costlier than the status quo, because Medicare’s size makes it more effective at restraining reimbursement rates.

If the CBO is correct, Ryan’s plan fails; beneficiaries’ out-of-pocket costs would roughly double to cover the added expense. But the CBO may be wrong. When a voucher system was adopted for Medicare’s new drug benefit, the CBO overestimated its costs by a third; the Centers for Medicare and Medicaid Services’ overestimate was 42 percent. When fundamental changes are made to a program, the green-eyeshade types can’t easily predict the results. Moreover, as health expert James Capretta notes, “managed care” plans in the Medicare Advantage program in 2010 did not have higher costs than Medicare’s fee-for-service for similar coverage.

Under Ryan’s plan, incentives would shift. Medicare would no longer be an open ATM; the vouchers would limit total spending. Providers would face pressures to do more with less; there would certainly be charges that essential care was being denied. The Obama administration argues that better results can be achieved by modifying incentives within the existing system. Perhaps. But history suggests skepticism. Presidents since Jimmy Carter have made proposals to control spending, with meager results. From 1970 to 2008, Medicare spending per beneficiary increased an average of 9 percent annually.

It’s Ryan’s radicalism vs. President Obama’s tinkering. Which is realistic and which is wishful thinking? This important debate should rise above cheap political rhetoric. Burdened by runaway spending, Medicare “as we know it” is going to end. The only questions are when and on whose terms.

Assisted Living Technology to Grow Rapidly

Mon, 30 May 2011 19:10:00 GMT

By AARP Global Network

As the populations of Europe and the United States age, more and more seniors will require enhanced care. As a way to strategically plan for these baby boomers, many companies are investing in assisted living technologies.

One new report conducted by Frost & Sullivan has found that devices aimed at helping older adults live safely at home or in retirement facilities earned revenues of approximately $154.92 million in 2009, a number that will likely rise to $525.58 by the end of 2015.

"A rapidly expanding elderly population in Europe is driving the need for continuous care, with mitigating this challenge featuring high on the agenda of governments in several European countries," said research analyst C.K. Somsainathan. "Governments are keen to address the needs of the elderly and provide the right social care to reduce the healthcare costs involved. Such trends are spurring the development of the market for assisted living technologies."

While governments are eager to invest in solutions that can help them accommodate the demands of aging baby boomers, recent budget cuts and the high price of initial installation have discouraged development.

The report suggests that businesses need to focus on raising awareness of the viability of assisted living devices and may also want to customize them so that they can better appeal to individual consumers. Another obstacle companies marketing these products to baby boomers have to overcome is concerns that a patient's sensitive health information could be put at risk by the technology.

Somsainathan stated that companies developing these devices should try to make them as user-friendly as possible while striving to make them secure.

Home medical alert systems are also expected to see unprecedented growth in the United States. The National Clearinghouse for Long-Term Care Information expects that 70 percent of American baby boomers will require long-term care technology during their retirement, according to TCPalm.com.

One product that Frost & Sullivan has recently recognized as a new solution for assisted living needs is BeClose, which received the 2010 North American Technology Innovation of the Year Award for personal emergency response systems (PERS).

BeClose offers an installation package of peripheral sensors, a base station and a website for online health monitoring. Each device can be customized so that it can meet the changing needs of a senior.

"With the [senior] demographic continuing to grow, elderly care and 'aging independently' are at the core of the current healthcare crisis," research analyst industry manager Zachary Bujnoch said. "This is where solutions like the BeClose system will play a crucial role."

UnitedHealthcare threatens to pull out of state if insurance law changes

Fri, 27 May 2011 16:30:00 GMT

BY KIRSTEN STEWART

The Salt Lake Tribune

First published May 25 2011 02:48PM
Updated May 26, 2011 07:31AM

Utah’s latest attempt to curb soaring health care costs may have the unwanted effect of reducing competition among health insurers.

Insurance broker and Taylorsville Republican Rep. Jim Dunnigan has revived a vetoed bill that would grant health insurance companies greater flexibility in pricing their plans for small employers. The bill would allow insurance companies to extend discounts to young workers and single parents with one child, while hiking premiums for older workers and larger families.

It was unanimously endorsed last week by the Business and Labor Interim Committee and is expected to surface in a special legislative session on June 15, said Dunnigan, who expects little opposition. “I think we’ve addressed everyone’s concerns,” he said.

Everyone, that is, except the country’s largest health insurer, UnitedHealthcare, which has threatened to pull out of Utah’s small-group market if the bill passes. The company initially denied any threatened exodus through spokeswoman Cheryl Randolph. But at an Utah Insurance Department board meeting on Tuesday, a United representative said the programming costs of adding a special pricing category for single, one-child parents may leave the company with no choice but to bow out.

United is working with Dunnigan to keep coverage affordable for small businesses and is committed to the small-group market in Utah, Randolph added in a later statement.

Under current law, insurers charge a parent with one child the same premium as a parent with two or more kids.

Dunnigan said he is negotiating with United and is confident he will find a solution. “If they pull out of the market, it will be for another reason,” he said.

United and other big national carriers have fought to grab a bigger share of the Utah market, where Selecthealth and Regence BlueCross BlueShield claim 60 percent of all privately insured residents.

How to Talk to Potential Clients at Social Events

Thu, 26 May 2011 19:27:00 GMT

There are many social situations everyday that give us an opportunity to interact with others and spread the word about our business. If you treat every social event as the chance to meet new people and turn them into potential clients, you can exponentially grow your business. If you show someone you can offer them a valuable service while still interacting in a fun social environment, you can engage people in business in a non-threatening way.

1. First, of course introduce yourself. If you are not introduced by a mutual acquaintance, take the initiative and say hello when the opportunity arises, such as when the individual is alone or getting another beverage.

2. Don't start off with what you do. Chat about something on neutral ground like the event, the food, the weather, or local events. Most people do not like being "sold" to during a social event. Do not make the potential client feel like you want something from him.

3. Ensure the potential client gets your information, without hard-selling yourself or making a direct sales pitch.

4. Interject what you do and where you work comfortably during the conversation if you can. At that time, it may be appropriate to provide your business card, but make sure you have offered them valuable information first or a good reason to find out more about what you do.

5. Ask the potential client for his or her business card if you think the conversation will be cut short for some reason. You can reciprocate by offering your business card.

6. Contact the potential client after the event. It still may not be appropriate to hard-sell the potential client, so find a non-intimidating reason to contact the person, such as asking if the potential client would like to receive your newsletter or follow up on a topic that came up during your interaction at the event.

7. Treat people how you would want to be treated. Potential clients are real people, not dollar signs.

House Votes to Defund Health Exchanges

Thu, 05 May 2011 17:22:00 GMT

By Bill Kenealy

House Republicans scored a symbolic victory against last year’s health care reform law on Tuesday, passing a bill that defunds one of the law’s central tenets by a margin of 238-183.

H.R. 1213, “To repeal mandatory funding provided to States in the Patient Protection and Affordable Care Act to establish American Health Benefit Exchanges,” passed with unanimous Republican consent and five Democratic votes.

As the name implies, the bill targets the automatic funding intended for the newly mandated insurance exchanges, but does not, however, repeal the requirement that each state establish such an exchange.

"Repealing the fund will protect precious taxpayer resources at a time of record red ink," the bill’s sponsor, Rep. Fred Upton (R-Mich.), said on the House floor.

Elsewhere, a consumer health organization called the legislation misguided.

“House Republicans rhetorically exalt the private health insurance marketplace,” said Ron Pollack, executive director of Families USA. “They ironically, however, plan to defund the creation of such state marketplaces that would enable consumers and small businesses to choose the private health plans they want. This is a perfect example of how their politically motivated zeal to criticize the Affordable Care Act trumps even their long-stated principles.”

Over 60 Ways to generate new leads!

Thu, 05 May 2011 16:50:00 GMT

Need fresh ideas to increase client lead generation? Check out this list for ways to find and satisfy existing clients.

There is an idea for everyone from Google Adwords to adding Zest to your media campaign. Even putting a few of

these ideas put into action can increase your network and boost sales, so what are you waiting for? Choose a few

things on the list and get started!

*Adapted from Cyan Ta'eed

Word of Mouth

Enlist your family and friends to spread the word about your services
Send out an E-mail to everyone in your address book, announcing what you do, where you are and what you can offer
Ask your satisfied clients for referrals
Offer free consultations to new referrals
Consider a referral fee or reward

Love Your Clients

Get in touch with past and current clients when you have a new service to offer them
Get in touch with past and current clients when you have completed a flagship project
Start a newsletter
Take advantage of every outgoing email by using your email signature as a marketing tool
Send promotions for services with your invoices
Ask your clients to place a credit on your work in web, video or print
Make a calendar featuring your work for clients to put up in their offices to serve as a constant reminder
Make a poster for your client to hang up on their office wall

Talk the Talk

Go to industry events – conferences, association meetings, seminars
Go to events in your client’s industry
Sponsor a client event
Join your local Chamber of Commerce and get involved
Socialize and always have your card ready
Do some pro-bono work for a charitable organization with industry links
Get involved in social groups you’re connected to (church, school, university)
Join an industry organization and get listed
Contact people you used to work with and ask them to send you any run-off work they might have
Offer to give a seminar to a local business group
Practice an elevator speech about what you do and have it ready to go wherever you are
Participate on online forums (using the forum signature line)
Comment on blogs to draw people back to your freelance site

Promote Yourself

Get car signage
Get t-shirts made with your URL
Try location based Google Adwords
Advertise in a niche magazine or trade publication e.g. a magazine just for cafes
List yourself in business directories or the Yellow Pages
Research sites your clients are visiting and buy advertising there
Advertise in online directories
Take out an ad out in a local newspaper
Participate in a trade show
Holidays are your friend! Send a clever holiday greeting to clients showing your work
Promote a free first consulation service
Have a gimmick that makes you stand out
Give something away for free
Place an advert in an industry newsletter
Offer branded pens and paper at industry events

Be an Industry Expert

Pitch an article to an industry publication
Pitch a story to a blog or resource website
Offer to speak at industry and networking events
Start a blog and publicize it
Submit tutorials or how-to’s to websites
Get on the radio
Write an eBook or Report for your target market and promote it online
Enter your work into competitions and awards… and win

Use the Media

Issue a press release about a story related to your services and try and get it into a local newspaper or magazine
Pull a publicity friendly stunt (think Richard Branson)
Run a contest which ties into your services

Job Boards

Keep an eye on online job boards
Check out Craigs List for you city
Keep an eye on offline job boards
Pin up a little advert on boards in your local area or community

Create Value

Find out how you could improve a company’s business and profits and cold call them with your pitch
Mail promo postcards to potential clients
Mail fun promotional items to potential clients (calendars, toys, posters etc)

Help Leads Find You

Search-optimize your website and get Google traffic
Have a follow up conversation with all potential leads
Make sure you’re listed in the Yellow Pages and White Pages business setion

Link-Up with Local Businesses

Contact your local internet service provider or printing house and offer them a commission if they refer work
Establish contacts in larger agencies that can refer their run-off work
Keep in touch with freelancers that will offer clients a complementary service to yours and throw each other work
Create a local business directory and use it to get to know other business owners who might later need your services
Cross promote with other businesses
Ask if you can put your business cards or brochure in local stores
Rent office space shared with other businesses or freelancers

Ten Things You Should Know Before Purchasing Life Insurance

Mon, 02 May 2011 02:22:00 GMT

1. Review Your Insurance Needs

Talk to an insurance agent, he or she can help you evaluate your insurance needs and give you information about available policies.

2. Decide How Much Coverage You Need

How much of the family income do you provide? Does anyone else depend on you financially? How will your family pay final expenses and repay debts after your death? Based on the answers to these questions, decide how much coverage you need, for how long and what you can afford to pay. You want to make sure that you buy enough life insurance to cover the financial effects of an unexpected or untimely death.

3. Assess Your Current Life Insurance Policy

If you already have a life insurance policy, do not cancel it until you have received the new one. You then have a minimum period to review your new policy and decide if it is what you want. Keep in mind that you may not have to cancel your current policy. You may be able to change your policy to get the coverage or benefits you want now.

4. Compare The Different Kinds of Insurance Policies

There are two basic types of life insurance: term insurance and cash value insurance. Term insurance generally has lower premiums in the early years, but does not build up cash values that you can use in the future. Cash Value life insurance may be one of several types: whole life, universal life and variable life. Your choice should be based on your needs now and in the future and what you can afford.

5. Be Sure You Can Afford the Premium Payments

Before purchasing a life insurance policy, be sure that you can handle the premium payments. Can you afford the initial premium? If the premium increases later, will you still be able to afford it?

6. Have an Insurance Agent Help You Evaluate the Future of Your Policy

How quickly does the cash value grow? Some policies have low cash values in the early years that build quickly later on. Other policies have a more level cash value build-up. Ask your agent for a year-to-year display of values and benefits.

7. Keep Your Current Policy

It is important that you do not drop one policy and buy another without a thorough study of the new policy and the one you have now. Replacing your insurance policy may be costly.

8. Understand Renewal Policies

You can renew most term insurance policies for one or more terms even if your health has changed. Each time you renew the policy for a new term, premiums may be higher. Ask what the premiums will be if you continue to renew the policy. Also ask if you will lose the right to renew the policy at a certain age.

9. Read Your Policy Carefully

Do premiums or benefits vary from year to year? How much do the benefits build up in the policy? What part of the premiums or benefits is not guaranteed? What is the effect of interest on money paid and received at different times on the policy? These are all questions that you should be able to answer by reading your policy thoroughly. Your agent can help you understand things that are unclear.

10. Review Your Life Insurance Program Every Few Years

How will inflation affect your future needs? Do you need more insurance when your family size increases? Review your policy with your agent every few years to keep up with changes in your income and needs.

This alert is produced by the National Association of Insurance Commissioners, a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and five U.S. territories. The overriding objectives of state regulators are to protect consumers and help maintain the financial stability of the insurance industry.

'RyanCare' won't work with out ObamaCare

Sat, 30 Apr 2011 21:19:00 GMT

Say what you want about Rep. Paul Ryan's plan to revamp Medicare, the man has akeen sense of irony.

As part of a Republican spending proposal for 2012 and beyond, the House BudgetCommittee chairman wants to scrap Medicare as we know it and have seniors buyprivate insurance, beginning with new retirees in 2022.

This comes after two years of Republicans pillorying Democrats for seeking Medicare cuts of much smaller scale. But that's just politics. The real irony isthis: The plan won't work unless joined with something much like the 2010 healthcare law Republicans want to repeal. That law, sometimes called ObamaCare bycritics, creates regulated insurance markets with a variety of inducements,subsidies and requirements, to help the 51 million people who can't afford, orcan't get, coverage.

The GOP plan (let's call it RyanCare just to balance the scales), would treatseniors the same way, starting with people currently younger than 55 when theyreach Medicare age. Unlike older people, who would continue to be under theprotective umbrella of government coverage, they would be given a governmentsubsidy to buy coverage in private markets, posing the question of whichcompanies would want to insure them.

As things stand, the answer is few, if any. Before the creation of Medicare in1965, the insurance industry wanted little to do with seniors. They are thecostliest segment of society to insure, accounting for 33% of medicalexpenditures but only 12% of the population. Though private companies are nowinsuring some seniors through a program called Medicare Advantage, this worksonly because it is subsidized by taxpayers over and above regular Medicare, andbecause companies cherry-pick the healthiest customers.

To take on the entire senior market, insurers would need considerableinducements. And seniors would reasonably demand competitive markets, multiple options, and some level of government oversight to make sure that they are beingtreated fairly.

For starters, RyanCare (which is only in a skeletal form now) would need thetypes of exchanges set up by ObamaCare. To some degree, Ryan acknowledges this. But he carefully chooses to compare his exchanges not to those in ObamaCare, butto those used by federal employees, a dubious comparison because federalemployees are extremely attractive to insurers as they tend to be healthy,well-educated and stably employed. Regardless, exchanges are mainly a place forpeople to pick conveniently among certified plans.

Beyond that relatively simple issue, it is far from clear whether a poolconsisting solely of seniors (with their high costs and fixed incomes) would beviable. ObamaCare would put all private buyers in a single pool in 2014. Addingseniors to that pool would be less challenging than creating a seniors-onlypool. The law allows insurance companies to create different price bandsdepending on age, though with limits that still benefit the older population.

Then there is that little issue of an individual mandate, the one that Republicans are challenging in court. If seniors are to have a right to buyprivate insurance regardless of pre-existing conditions, insurers wouldnaturally demand such a mandate. They won't cover a population where people canwait until they get cancer or diabetes to buy coverage. That's not how insuranceworks. It's about sharing risk.

Alternatively, the Ryan plan could leave seniors with no right, or a limitedright, such as a one-time chance at retirement age.

In either case, a very significant number of seniors would be left without protection. It's one thing to bash the individual mandate as a way to rally theopposition against the opposing party's agenda. It's another to do so whileselling a major new program of your own imbued with the troubling consequencesif it lacks the requirement.

The individual mandate was originally the work of conservative thinkers at the Heritage Foundation and other institutions. The same goes for the exchanges.Until the past few years, the individual mandate was championed by Republicanlawmakers as a cornerstone of creating private insurance markets (whilecandidate Barack Obama was skeptical of it). If Republicans really want tocreate private markets for seniors, there is a good chance the two sides willhave to switch sides again.

We point out these ironies in hope (probably vain) that each party would insteadhave an epiphany on health care. For Republicans, we would hope that they getbeyond the imbecilic politics of trying to repeal ObamaCare, and focus on whatin it needs to be modified, improved, or scaled back. While the law is arguablytoo generous and too bureaucratic in some areas, its core purpose of creatingprivate markets is highly useful, not only to covering the uninsured but also asa platform for future reforms. In addition to working with Ryan's Medicare proposal, it could be matched up with an intriguing proposal he left out of hislatest plan that would encourage workers to get their insurance independently oftheir employers.

As for Democrats, we would hope that they begin to acknowledge the obvious: thatexploding costs for Medicare (and health care more generally) need to beconstrained in ways that ObamaCare does not even begin to touch. The public willnot like any of these, no matter which party produces them. They're all choicesbetween paying more or getting less.

Until these things happen, we can at least be amused by the absurdity ofcontemporary politics.

Cash in on your life

Fri, 29 Apr 2011 22:06:00 GMT

INSURANCE IT'S EASIER NOW TO SELL A LIFE-INSURANCE POLICY FOR IMMEDIATE CASH. BUT IT'S NOT ALWAYS A GOOD IDEA.

KENNETH SAHS, 71, FACED A ONCE-IN-A-LIFETIME DECISION last year. His $500,000 convertible term life insurance policy would soon expire. Sahs could drop it and get nothing or convert it to universal life, a form of cash-value insurance, and take on $12,000 a year in premiums.

Then Sahs and his wife, Marie, read in Kiplinger's that they had a third choice: to sell the policy to an investor. To their delight, the Sahses got a quick $125,000. No more eventual death benefits, but no more premiums, either. "Insurance companies don't tell you there are opportunities like that," says Marie, "'It's like a treasure chest you don't know to look for."

The couple called an independent insurance consultant, who solicited offers from a life-settlement broker and relayed the terms to the Sahses. Much of the payout will be taxed at the low capital-gains rate, a further benefit.

Many seniors are now selling their lid insurance policies to raise cash. In 2006 alone. policies worth $6.1 billion hi death benefits changed hands. This trade wouldn't be possible, however. except for one controversial aspect: The party on the other end profits from your death--and the sooner, the better. When you (or a family member who may actually own the policy on your life) sell the insurance, the buyer becomes the owner and beneficiary, Upon your death, this stranger stops paying premiums and collects tile death benefit.

These transactions used to be called viatical settlements. They, were especially ghoulish because early investors were generally small companies that offered big discounts from the death benefit to buy policies from AIDS patients, who weren't expected to last long and desperately needed cash for medical bills. (Some investors lost a lot of money when new drug combinations greatly prolonged the life of AIDS sufferers.) Now these deals a re called life settlements and are moving to the financial mainstream. Institutions such as Goldman Sachs, JPMorgan and Credit Suisse, as well as hedge funds and German pension funds, are investing in packages of life settlements because the rate of return is not correlated to the stock market, making life, settlements a portfolio diversifier. Even some life-insurance companies, such as Phoenix, are becoming investors.

HOW IT WORKS
If a settlement is a great deal for Goldman Sachs, can it be fair to Kenneth and Marie Sahs--or to you and your family? Tile answer is partly a matter of perception: Does $125,000 seem like a small fortune to you? Or is the reduced amount a sacrifice?

As the life-settlement business grows, it's getting cleaner, and pricing is becoming more consistent. Investors usually prefer people over 65 who are insured for $500,000 or more, If you have a cash-value policy, they'll generally offer far more than you would get by surrendering it to the insurance company--often two and a half times that amount, says insurance adviser Norman Hood, of Rushville, Ill. Investors will also buy term policies, which have no cash value, if the policy is convertible to a cash-value policy and the premiums make sense to the investor. The size of a settlement varies with the insured person's age, health and life expectancy, but sellers generally get 20% to 30% of the death benefit. The Sahses got 25%, a little more than some other 71-year-olds would get, because Kenneth had heart surgery, shortening his life expectancy.

The hunt for this treasure stares with a life-settlement broker, which Veil can locate online or through a financial adviser. These middlemen gather your health and financial data and solicit settlement offers from investors. One transaction feeds a bunch of mouths, so brokers expect competing offers to vary, sometimes drastically. Insist that the broker get five or six offers and show you all of them, as some states require. Be suspicious if anyone tries to steer you toward one offer, because it may be the deal with the highest commission. You've kissed away a fortune if you discover that the broker took a cut of 30% of the death benefit when 10% of the settlement amount is fair.

It is getting easier to assess life-settlement offers. Some institutional investors have banded together to create disclosure forms and other standards as they try to drive out smaller middlemen and other investors. Some independent insurance analysts and agents will estimate what your policy is worth for a flat fee, such as $1,000 or $2,000.

QUESTIONS TO ASK YOURSELF
Do I still need the insurance? If you're 65 or older, or if you have health issues, you may be unable to replace the insurance (or unable to afford to). So think about why you got the policy in the first place. "Remember that you bought it to meet a certain need--family planning, estate planning, business--and make sure that the need truly is gone," says Mark Johannessen, a financial planner in McLean, Va., and president of the Financial Planning Association. If you still have a mortgage in retirement or are supporting or educating children or grandchildren, you should probably keep the insurance.

What's the net payout? The key is what you'll keep after taxes. A life settlement is the sale of an asset, a taxable event. The tax specifics are up in the air in Congress and the courts. So most sellers make a three-tiered tax calculation: First, you don't owe taxes on the premiums you've paid through the years (minus any outstanding policy loans). Second, you owe ordinary income taxes on the difference between premiums paid (your basis) and the cash value. Third (and this is the big break), you pay capital gains on the amount by which the payout exceeds the cash value--which is likely to be most of the haul.

Is there a way to save on the cost of insurance? If you need insurance in old age but can no longer afford it, you may have other options besides a settlement. Universal life, for example, has built-in flexibility in what you pay, says Glenn Daily, a fee-only insurance consultant in New York City. "A lot of people don't understand that they can change their premium," Daily says. If you have ample cash value, you may be able to skip or reduce your premiums for a while without danger that the policy will lapse.

Would a policy loan work instead? Life-settlement brokers focus on two numbers: the amount you'd get if you surrendered the policy to the insurance company and the substantially higher payout from a settlement. But those aren't your only options. If you need cash and want to keep the insurance in effect, you can take a policy loan up to almost the amount of the cash value. You won't get nearly as much as in a life settlement, but your beneficiaries will still get the bulk of the death benefit tax-free when you die (the benefit payment is reduced by the loan principal and accrued interest). There's no tax on loan proceeds and no requirement to repay the money, as long as you don't let the policy lapse.
What about family members? If you are ill and have only a year or so to live, it would be crazy to sell the policy for any amount (or to let a family member with power of attorney do so). Your insurer may offer accelerated death benefits, freeing up the death benefit while you're still alive.

If investors find your policy extremely attractive because your life expectancy is short, it's worth making maximum effort to salvage the policy. "You might want to schedule a meeting with your beneficiaries and say, 'This is what I'm thinking about doing. Here's what it might cost to keep this policy in effect,'" says Adam Harem, North Dakota's insurance commissioner. Your sons and daughters or other heirs might pitch in to help pay the premiums or lend you the money because they'll end up with a much bigger and tax-free payout if you maintain the coverage. "If the offer is $200,000 today, before taxes, or $1 million tax-free if you keep the policy, what would you do if you were the beneficiary?" Harem asks.

SMART SHOPPING
If you decide that a life settlement is still your best option, you want to ensure you negotiate the fairest deal. You can get a ballpark estimate by using Norman Hood's free tool at www.policysettlement.com, but that's just a start.

Get multiple offers. "There are about 60 different life-settlement companies, and they all have unique buying criteria," says Daniel Anderson, chief executive of Madison Brokerage, in Morristown, N.J. That means the brokers like Anderson who present your information to investors can, and should, drive a hard bargain on your behalf. Your goal is to hold out for the highest percentage of the death benefit and hope that a particular institutional investor is looking for a person like you to round out its diversified pool of death-benefits-to-come.

Find out how much money each participant in the deal is getting. "In some cases, the brokers are making the same amount as, or more than, the consumer," says Jim Poolman, who helped develop the National Association of Insurance Commissioners' model life-settlements law, which several states have recently passed or are in the process of adopting.

"Consumers have the right to look at their brokers and the people involved and say, 'Maybe I don't want to pay that much,'" says Jack Kelly, director of government relations for the Institutional Life Markets Association. The association requires life-settlement brokers to fill out disclosure forms for consumers before selling policies to its members (which include Goldman Sachs and Credit Suisse). Go to www.lifemarketsassociation.org for a copy.

Ask specifically how much money each person or company is getting, not just percentages. Sometimes the commission percentage is based on the full death benefit, and sometimes it's based on the purchase price. "Once you get a commission below 10% of the purchase price, you're doing okay," says Daily. Ideally, the commission shouldn't be charged against the part of your settlement that is the existing cash value because that's yours to take anyway. Some insurance companies that are getting into the settlement business see it this way; some of the settlement firms do not.

Ask who will own your policy. The creepiest thing about life settlements is that a stranger will benefit from your death. Fortunately, most investors are now large banks and other institutional investors that own big pools of policies (similar to the way mortgages are traded) and not individuals who are counting the days until you die. Also inquire about how often the life-settlement company will contact you after you sell your policy. You don't need frequent calls asking if you've been in the hospital. An occasional form letter should suffice.

Ask about privacy. To get a quote, you must authorize the broker to view your medical records. Find out who else will have access and who will have your name after you sell the policy. Hood, the Illinois insuranceadviser, says you should insist that the broker withhold your name, address and other identifying information from anything sent to big investors, who should care only about your age, health and the type and cost of theinsurance they're being pitched to buy.

Talk with independent experts. Before accepting an offer, run it by an independent financial adviser whose compensation is not based on whether you sell the policy. Be particularly wary of any insurance salesperson who is pushing hard to have you sell your policy and then buy a new one. "There's the potential to earn two commissions from the sale--one from the life settlement and another from a life-insurance sale," says John Gannon, senior vice-president of investor education for the Financial Industry Regulatory Authority. See Finra's Investor Alerts for more information at www.finra.org.
A trustworthy way to judge an offer is to use insurance expert Glenn Daily's "What's My Policy Worth?" service (www.whatsmypolicyworth.com). He charges $1,895, so this makes sense only if your payout would be large. Daily takes five to ten hours to analyze the cost of the policy, your life expectancy and how much everyone involved would get from the sale. The exercise could help you negotiate a larger payout.
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Copyright Kimberly Lankford

Japan Earthquakes Costs Estimated $34 billion in Losses for Global Insurance Industry

Sun, 24 Apr 2011 05:32:00 GMT

The Japan earthquake and tsunami of March 11 have caused an estimated $34 billion in losses for the global insurance industry due to life, health and damage insurance costs.

Catastrophe modeling company RMS said on Tuesday that the magnitude 9.0 quake and subsequent flooding probably caused $18 billion to $26 billion in property insurance losses, plus $3 billion to $8 billion in losses to the life and health insurance sectors.

RMS is the last of the big three catastrophe modelers to release its loss estimate for the Great Tohoku Earthquake, which killed up to 28,000 people and caused one of the worst nuclear accidents in history.

AIR Worldwide's revised quake and tsunami estimate is $20 billion to $30 billion and Eqecat's range is $12 billion to $25 billion. RMS’s insurance cost estimates were the highest estimates released for damage costs. The range of damage costs for the big three catastrophe modeling companies is now $20-$35 million. If the high estimate turns out to be accurate, the quake would go down as the most expensive of its kind for the insurance industry in a generation.

Majority of Seniors Feel Public Policy Will Affect Retirement Plans

Fri, 22 Apr 2011 16:57:00 GMT

According to LIMRA, the Life Insurance and Market Research Association, more than fifty percent of seniors ages 55-79 feel that changes to Medicare and Social Security will affect their ability to afford retirement. This research presented at the 2011 Retirement Industry Conference, examined how retirees received their income and how it is subsequently spent. It was revealed that eighty-five percent of seniors involved in the study relied on Social Security for their income while three quarters had a traditional pension plan for an income source, some utilizing both. “These concerns, as well as inflation, are top of mind for all retirees but especially true for those with the lowest incomes and assets, who can least absorb additional unexpected costs during retirement,” said Marie Rice, corporate vice president, LIMRA Retirement Research. “With so many lawmakers talking about cutting costs to reduce the growing deficit and the financial implications resulting from it, retirees who might have felt secure that their retirement savings would last their lifetime, now recognize the uncertainty of the times and how vulnerable they are.” The changes currently occurring in government budgeting could have a serious effect on the income and financial future’s of retirees.

The insurance industry can help guard retirees from financial risk and safeguard their future. “A significant change in public policy like Social Security and Medicare benefits could be disastrous for many retirees – particularly those with lower income and asset levels,” noted Rice. “For future retirees who will likely not have a pension plan to rely on, it will be important that they increase their current savings patterns and think about retirement income solutions including guarantee investments that will adjust for inflation. [The insurance] industry is uniquely qualified to provide solutions to protect retirees and help them achieve their financial goals.” The study also found that less than half of retirees worked with a professional in the financial planning industry. Retirees are going to have to rely on smarter financial planning, insurance options and increased savings as future income from Medicare and Social Security get ready for significant budget cuts and changes.

How to Find New Customers and Increase Sales

Fri, 29 Apr 2011 21:58:00 GMT

So, you’ve established a business and everything is going well, but how do you grow it? Attracting customers and providing quality goods and services to existing customers is a skill that can be learned. Elizabeth Wasserman from inc.com details what you as a business owner can do to understand and draw in more clients, in turn increasing your sales.

By Elizabeth Wasserman

How to better understand your target audience, generate new sales leads, and focusing on getting more revenue from existing clientele.

In a perfect world, you would have an unlimited budget to market your business in order to find new customers and increase sales. You could buy lots of online and offline advertising, run promotions to build traffic in store and online, and launch a proactive public relations campaign to increase your product or brand’s visibility and awareness. But this isn't a perfect world. Realistically, most small businesses and even many mid-sized firms have more great ideas on how to peddle their wares than available resources.

So where do you start if you are looking for more customers? Learning to generate new sales leads is an essential skill for an entrepreneur. Even if you don't consider yourself a salesperson in the classic sense of the Willy Loman character from Arthur Miller's play Death of a Salesman, you need to understand that the possibilities for finding new customers range from cold calling names from the phone book to buying lists of potential customers to using newer Internet techniques like search engine optimization to drive new business to your website.

The following pages will delve into how to conduct market research to understand your target audience and their needs, how to determine which lead generation techniques are best to broaden your sales horizons, and how to increase sales by following several strategies to sell additional products and/or services to existing customers.

How to Find New Customers and Increase Sales: Understand Your Target Audience

Before you can find new customers and increase sales, you need to understand who your customer is, what value proposition you offer to customers, and what your competition is currently offering in the market and where there are gaps for a new entrant. In other words, you need to do some market research -- whether that means hiring an outside firm to do the legwork or trying to do it yourself. There's an underlying disconnect between your motivation to increase sales and your customer's motivation to solve their problems.

"Attracting more customers is really about listening to their needs, not being a solution looking for a problem," says Paige Arnof-Fenn, founder and CEO of Mavens & Moguls, a strategic-marketing consulting firm whose clients include Fortune 500 companies as well as early stage and emerging businesses. "There are many existing problems out there that need to be solved that customers are willing to pay for today."

How to Find New Customers and Increase Sales: Find Out Who Your Current Customers Are

In order to develop a marketing plan to reach new customers, you need to better understand who you're already selling to. "If I'm trying to expand sales, I have to find out who my existing customers are. What are their demographics? What do they look like?" says Jerry Osteryoung, director of outreach for the Jim Moran Institute for Global Entrepreneurship at Florida State University. "That means doing market research."

Market research runs the gamut from very simple qualitative research to in-depth quantitative analysis. It can be done very quickly and inexpensively by sending surveys to your existing customers using one of the many online survey tools, such as SurveyMonkey or Zoomerang. You can also get to know the target audience by looking at existing sources of information -- from the U.S. Census Bureau or other government agencies, from trade associations, or from third-party research firms. But depending on the questions you are trying to answer and your research budget, your market research can involve more extensive interviews with customers and qualitative studies on how target customers feel about your business, its products and services.

Certain products and services may appeal to one audience but not to another, so understanding the strengths, weaknesses, opportunities and threats in your target market is critical. You can get to know your customers and segment the market any number of ways including by:

Demographics -- statistical data on a population including income levels, age, etc.
Psychographics -- the attitudes and tastes of a certain demographic.
Ethnographics -- examination of particular cultures.
Buying habits -- how, what and where customers purchase products and services.

How to Find New Customers and Increase Sales: Defining the Market for Your Product

Use the information about your existing customers to develop a target audience for your business in its drive to win new customers and increase sales. "While there are core customers you are trying to reach, often there are other markets that are also important to address," Arnof-Fenn says. "Make sure you know who the gatekeepers and influencers are; they will affect the decision makers and you will most likely need to sell to them differently than to the end user." For example, parents might be the gatekeepers for products targeted to children or technology managers might hold influence over a company's decision to invest in new software.

Determine which key messages, features and benefits matter to each potential market. Tell these customers how your business can help them solve their problems. "In order to have a customer go to your online shop, you have to find a reason why these customers want to come to you," Osteryoung says. "The value proposition has to be spelled out clearly."

Next, you need to figure out where to reach these customers and whether there should be a marketing or advertising plan that goes along with that outreach.

How to Find New Customers and Increase Sales: Generating Sales Leads

There are a variety of age-old staple techniques and newer tools you can use to find new customers and increase sales. It's best to understand the range of choices you have in order to determine which may best help your business reach new customers. Newspaper readers may not be moved by Internet-based sales techniques. Similarly, business people who are accustomed with hiring only people they know may be better swayed by meeting you at a chamber of commerce meeting than accepting a blind invitation to connect on LinkedIn or Facebook.

"It starts with good people," says Peter Handal, chairman and CEO of Dale Carnegie Training, the sales and leadership training organization. "If you're a one-man shop, it's one thing. But if sales people are really important, you need to hire and motivate good people and you want to give them an upside, such as sales on commission. The motivation is not just money it's also helping them overcome the fear of prospecting."

Here is a rundown on the techniques available:

Cold calling. This is telemarketing without the call center. It's a blind contact with a potential customer who isn't expecting a pitch. Customer leads can be picked up through scouring newspaper articles or items, lists of leads that are culled by a third-party, or paying attention to people or businesses moving into your turf. "People are always hesitant about cold calling or talking to someone they don't know," says Handal. "We coach people to give themselves a pep talk to get them in the mood. We suggest that they set a goal -- this is how many new people they will talk to this week."
Networking. This can be done the old-fashioned way, by getting involved in community organizations, such as the chamber of commerce, or attending business functions, such as trade shows. Social functions -- dinner invitations, book clubs, etc. -- can also lead to potential business. "All of those kinds of things are important ways to network to find new customers," Handal says. Networking has also taken a 21st Century twist on the Internet, with the rise in popularity of such websites as LinkedIn, Facebook, and Plaxo. Many businesses find that this type of networking, making contacts through friends or former colleagues, can lead to new customers.
Develop champions of your products. Use business contacts who have been happy with your products to help generate references and referrals. Once you have sold to them, customers can help you sell to others by offering positive testimonials and leveraging a refer-a-friend campaign created by your business. This technique also employs word-of-mouth marketing. Help customers help you by giving them the ammunition they need to tell your story to others. "Don't be afraid to ask, 'Is there someone else I can talk to and also help?" Handal says.
Affiliate marketing. Look at non-competitive products or services that are reaching out to the same audiences to see if there are ways you can collaborate through shared outreach efforts such as newsletters, mailings (online and offline) or co-branding opportunities. You probably can uncover a handful of like-minded products or services that are talking to your customers, Arnof-Fenn says. Suggest to these business owners ways your businesses can support each other. Your customers will see joint efforts as a value-added opportunity to reinforce their choice of brands.
Leverage your website. There are all sorts of tools these days through which you can drive potential new customers to your website. Search engine optimization (SEO) -- using keywords and other techniques to make your site appear on the first page of listings on search engines -- has become an art form. There are websites, such as Search Engine Watch, that will keep you updated about SEO techniques. In addition, there are a growing number of paid SEO consultants who can help you use all the tricks and techniques to improve your search results. You can also use a variety of blogs, chat rooms, podcasts, and webinars to generate awareness for your website and company. A website is a dynamic tool not a one-time experience. The top search engines are constantly updating their algorithms, so you must monitor your website on a regular basis to make sure your keywords are leading customers to you. Make sure you are keeping your website up to date with fresh content so your customers come back often for more.
Advertising. Typically businesses are encouraged to spend 3 to 5 percent of their revenue on advertising, but a small business needs to make sure that advertising is effective, Osteryoung says. One way to do this is to ask your customers where they heard about you so that you can measure what is effective. In addition, you also have to carefully pick your markets for advertising to make sure you're reaching your target audience. If you're targeting an older audience, newspaper ads might be the way to go. But if it's Gen X or Y you're after, then you may be better off advertising online or on TV, Osteryoung says. "You've got to define your demographics before you develop your advertising or marketing plan."

How to Find New Customers and Increase Sales: Sell More to Existing Customers

In order to increase sales, many businesses believe the only way is to find new customers, but a number of experts say that this strategy leaves out an obvious potential source of new sales. It's much easier to get an existing customer to buy from you than to convince a new customer to take the plunge. "They're forgetting about low hanging fruit -- their existing customer base," says Osteryoung. "If I want to expand sales, the number one place to go is the existing customer base. They already trust you."

Here's how to increase sales with your existing customer base:

Bundle products. You can "bundle" a few products or services together for a special price to try to get an existing customer to try some of your other offerings.
Try the "upsell." Convince your sales staff to go back to existing customers and try to sell those clients related products or services. A common example is a warranty, Osteryoung says. Think of how many times you've purchased electronics and a sales person has tried to sell you on an extended service plan. Customers sometimes take the bait.
Offer inside information. If a customer is eyeing a product but about to put it back on the shelf, make sure you let them know that the product is going on sale the following week. If you monitor your website's online shopping cart, you may email an existing customer who didn't complete a sale and offer them a discount to complete the purchase.
Think about customer rewards. Like the airlines have done with frequent fliers, there is no reason a small business can't reward good customers with a loyalty program. Offer a discount on their birthday or for every 10 purchases give them one for free.
Give free samples. Offering freebies isn't necessarily going to cost you an arm and a leg, but it can increase sales by engendering good feelings among existing customers, convincing them to pass on the sample to a friend or family member, and/or convince them to buy your latest hand cream or ice cream flavor.

"There's a lot you can do that doesn't require much more work," Osteryoung says. "You want to make sure you have saturation but obviously you never want to alienate the customer…. You never want to make the customer feel like you are hard selling them."

10 things you need to know abou the new health care reform law

Sun, 24 Apr 2011 05:32:00 GMT

10 Things You Need to Know About the New Health Care Reform Law

Helps 32 million more Americans ger insurance.
Makes preexisting conditons a thing of the past. Insuraers can't use them to deny coverage for children form this year on, or adults startin in 2014.
Guarantees basic benefits for everyone in Medicare, makes preventive services free for most, and gradually closes the "Doughnut hole" in the Part D drug program.
Sets up a termporary program in july to help people with preexisting health conditions obtain coverage.
Provides new benefit for most people who already have insurance, such as coverage for adult children until age 26.
Leaves medical decisions in the hands of you and your doctor.
Requires most people to have coverage by 2014 but offers subsidies for those with moderate or low income and makes more people eligible for Medicaid.
Creates state-run insurance exchanges offering a menu of private insurance plans for people who are uninsured, self-employed or between jobs.
Offers immediate tax credits to help small business buy insurance for employees.
Keeps Medicare financially sound for newarly 10 more years and reduces the U.S. deficit by an estimated $1.43 billion