Daily Insurance Report - November 2, 2023

Your summary of the Voluntary and Healthcare Industry’s most relevant and breaking news; brought to you by the Voluntary Benefits Association®

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Hear from former IRS Deputy Associate Chief Counsel (Employee Benefits) and Special Counsel for the US Department of Treasury on not one but two Legislative Update sessions:

  1. Understanding the Dynamic Federal Employee Benefits Legislative Landscape

  2. Understanding the Dynamic Legislative LTC & “Junk Insurance” Landscape

Lastly, join us for a fast-paced presentation The Medicare Minefield & Medicare Decoded in which we’ll cover all the elementary components of Medicare Part A through Part D. We will also cover the nine most misunderstood facts of Medicare, and all the mistakes and pitfalls that most seniors and their caregivers are typically unaware of.

VBA Poll Question - Please share your insights

Do you believe that the healthcare benefits your company offers to employees are affordable and sustainable for your organization?

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Our last poll results are in!


of Daily Insurance Report readers who responded to our last poll stated that the cost of their health plan renewal will remained the same.

28% that responded said the cost of their health plan renewal will significantly increase, 14% said their cost will slightly increase, while only 9.23% said the cost of their health plan renewal will decreased.

Have a poll question you’d like to suggest? Let us know!

Biden Labor Department taking direct aim at FIAs in new fiduciary rule

By John Hilton - Federal regulators are taking yet another crack at extending a fiduciary rule to annuity sales, this time with tighter messaging and full-throated White House backing. Administration officials began sharing details Monday on the long-awaited "Retirement Security Rule: Definition of an Investment Advice Fiduciary." In doing so, officials are attaching President Joe Biden's name to the effort and using phrasing like "junk fees" and emphasizing the need to "close loopholes" in the law. Read Full Article…

VBA Article Summary

  1. Historical Challenges with Fiduciary Rules: Previous attempts by the SEC and the Department of Labor to enforce fiduciary rules for financial advisors have failed to hold up in court. Notably, the SEC's Rule 151A in 2009 faced a legal defeat for failing to adequately analyze its impact, and the Obama administration's 2016 fiduciary rule was struck down by the Fifth Circuit Court of Appeals. These setbacks highlight the difficulties in creating durable regulations that oversee financial advisors' obligations to prioritize their clients' best interests over their own financial gain.

  2. Concerns Over Conflicted Advice and Hidden Costs: Lael Brainard from the National Economic Council has emphasized the administration's stance on financial advisors putting savers' interests first, specifically targeting "junk fees" and "conflicted investment advice." The White House has pointed out the issues with fixed indexed annuities (FIAs), suggesting that they may not be the best investment for savers due to their capped upside, potentially costing investors billions in lost retirement savings according to a Cerulli report. This highlights the administration's concern that investors may suffer from hidden costs and advice that benefits the advisor at the expense of the client.

  3. Revising and Restructuring the Fiduciary Framework: The Department of Labor has refined the "five-part test" from 1975, reinterpreting it under the new rules to better identify what constitutes fiduciary investment advice. This reinterpretation aims to focus specifically on advisors who have a trusted relationship with clients, removing contractual requirements that were present in the 2016 rule. Furthermore, the new rule includes amendments to the Prohibited Transaction Exemptions, clarifying what kind of advice and compensation structures are permissible. Despite these efforts, the new rules have already faced legal challenges, including lawsuits in Texas and Florida, demonstrating ongoing resistance to regulatory changes in the financial advisory landscape.

Open enrollment on the ACA exchanges is set to begin. Here are 5 trends to watch

By Paige Minemyer - Open enrollment on the Affordable Care Act's (ACA's) exchanges is set to begin, but signing up for coverage remains confusing for many, a new analysis shows. That's one of several trends to watch during the sign-up window, which [began] Nov. 1 and runs through Jan. 15, according to experts at KFF. As part of its annual look at consumers' experiences with insurance, the researchers polled more than 3,600 adults in the U.S. who have coverage. Read Full Article…

VBA Article Summary

  1. Difficulty in Finding the Right Coverage: A substantial 35% of those enrolled in marketplace plans report challenges in finding appropriate coverage, a stark contrast to the lower percentages of those enrolled in Medicare (15%), employer-sponsored plans (17%), and Medicaid (19%). The Kaiser Family Foundation (KFF) suggests that the complexity is partly due to marketplace coverage often being a transitional solution, leading to a high turnover rate and a lack of familiarity among new enrollees. Variability in state-level outreach and information access, along with the overwhelming number of options, further complicates the selection process for many individuals.

  2. Trends in Open Enrollment and Premiums: Record-setting enrollment trends continue, with 15.7 million people signing up during the 2023 period, and projections for even higher enrollments as individuals transition from Medicaid following renewed eligibility checks. Despite subsidies mitigating costs for many, average premiums for marketplace plans are projected to increase by 5% for silver and 6% for bronze plans in 2024, driven by inflation and normalized post-pandemic healthcare utilization. The Biden administration’s expanded subsidies play a crucial role in shielding consumers from these rising premiums, underscoring a dynamic interplay between policy interventions and market conditions.

  3. State-Level Changes and Insurer Market Dynamics: State-specific policy changes are poised to have diverse effects on open enrollment, with California extending cost-sharing reduction subsidies, North Carolina expanding Medicaid eligibility, and Washington state providing subsidies to undocumented immigrants. While certain insurers like Oscar Health and Cigna are withdrawing from specific markets, overall insurer participation in the exchanges is anticipated to strengthen, marked by new entrants in multiple states, signaling a robust and competitive insurance marketplace for the year 2024.

This is employers’ top financial wellness concern today

By Dawn Kawamoto - Thanks to record-high inflation last year, rising interest rates, flat wage growth and other economic factors, employers now say their top concern about employee financial wellness is the high cost of living, according to a recent survey by the Employee Benefit Research Institute. Read Full Article…

VBA Article Summary

  1. Shift in Employer Priorities: The Financial Wellbeing Employer Survey has indicated a pivotal shift in employer concerns, with cost-of-living issues taking precedence over retirement preparedness for the first time. This shift, informed by responses from 252 HR leaders at large companies, demonstrates a growing recognition of the immediate financial pressures faced by employees, outranking long-term savings concerns.

  2. Proactive Employer Initiatives: In response to rising living costs and persistent inflation, employers are actively enhancing financial wellness programs. More than half of the surveyed companies are implementing new initiatives in 2023, including employee discounts, money management tools, and financial education. Additionally, more personalized support such as one-on-one financial coaching and debt management programs are being introduced to directly tackle the economic challenges employees face.

  3. Long-term Implications and Strategies: The persistence of high inflation rates is causing employers to consider the long-term necessity of these financial wellness programs. While historically, support was limited to basic educational resources, the sustained economic pressures are leading to more comprehensive solutions, such as partnerships with lenders for debt consolidation and enhanced access to financial advice. These strategies not only aim to alleviate immediate financial stress for employees but also to improve overall workforce stability, productivity, and retention in a competitive labor market.

HHS proposes information blocking penalties for health systems

By Eric Wicklund - Federal officials are proposing penalties for healthcare organizations accused of information blocking. The Health and Human Services Department has released a proposed rule that would establish three specific “disincentives” for healthcare providers found by the HHS Office of the Inspector General (OIG) to have knowingly and unreasonably interfered with the access, exchange, or use of electronic health information except as required by law or covered by regulatory exception. Read Full Article…

VBA Article Summary

  1. Public Input and Timeframe: The Department of Health and Human Services (HHS) has announced an open period for public comments on the newly proposed rule aimed at reducing information blocking in the healthcare sector. Comments from the public are being accepted up until January 2, 2024. This follows the implementation of similar information blocking penalties for health IT vendors and networks by the Office of Inspector General (OIG) earlier in June. Notably, any entity found in violation of this rule could face steep fines up to $1 million per incident.

  2. Health Systems in Focus: HHS is now turning its attention to health systems to enforce the sharing of electronic health information (EHI). Secretary Xavier Becerra emphasized the department's dedication to fostering policies that prevent information blocking, ensuring that both patients and health providers have access to EHI. The proposed rule introduces significant disincentives for health entities that do not comply. These include substantial payment reductions and penalties affecting Medicare and Medicaid service providers, with the intent to motivate proper EHI management and sharing.

  3. Specific Disincentives and Their Impact:

    Medicare Promoting Interoperability Program - Non-compliance will disqualify hospitals from being recognized as meaningful EHR users, leading to a substantial reduction in the annual market basket increase.

    Merit-based Incentive Payment System (MIPS) - Eligible clinicians or groups that fail to be meaningful users of certified EHR technology will receive a zero score in the relevant MIPS category, significantly affecting their annual MIPS score.

    Medicare Shared Savings Program - Providers associated with Accountable Care Organizations (ACOs) could face at least a one-year ineligibility period for the program, which may result in removal from or inability to join an ACO.

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HR technology in 2024: What to look for

By Steve Boese - As an eventful and surprising year winds down (did anyone foresee the surge of generative AI at the end of last year?), I have been pulling together reflections on HR and HR technology in 2023. I aim to map out what the team at H3 HR Advisors and I think will be the most important trends heading into 2024. Read Full Article…

VBA Article Summary

  1. Generative AI: The Game Changer in HR Functions: The advent of generative AI is poised to revolutionize HR tasks by automating routine processes and offering intelligent support, allowing HR professionals to concentrate on strategic objectives. Its impact is far-reaching, from recruitment to performance management, indicating that it will be the central focus in HR technology discussions and strategies in 2024.

  2. Skills-Based Growth: A Shift in Talent Management: Moving towards a skills-based approach allows companies to harness a broader talent pool, focusing on actual abilities rather than traditional credentials or job titles. This paradigm shift enables organizations to align the right individuals with suitable roles, ensuring a more dynamic and efficient workforce that drives organizational growth.

  3. Responding to Demographic Shifts in the Workplace: Addressing the evolving demographics within the workplace is crucial for maintaining a robust and knowledgeable workforce. Strategies for supporting older employees and facilitating knowledge transfer to newer, younger employees will be essential in preserving institutional knowledge and promoting a healthy, adaptable, and inclusive work environment.

AI-assisted Drug Development is the Future

By Jo Varshney - The U.S. drug development process for novel therapeutics targeting difficult-to-treat diseases takes an average of 10 to 12 years to complete. For drugs that go into development this year, that timeline leaves most patients battling severe illnesses without a lifeline. This includes the 33 percent of cancer patients who are not expected to live past five years post-diagnosis. The odds aren’t much better for those suffering from other, lesser-known illnesses, like severe acute pancreatitis, which has a 10-year life expectancy of just 70 percent. But it doesn’t have to be this way. Read Full Article…

VBA Article Summary

  1. Extended Duration of Drug Development: Drug development in the United States is inherently a long process due to the rigorous testing required to ensure new drugs are safe and effective. This comprehensive process typically encompasses years of preclinical studies, extensive clinical trials, and thorough independent reviews. Delays can arise if a drug is found to have adverse effects or is less effective than anticipated, which can lead to costly setbacks or even the cessation of development, as the immense costs—ranging from millions to billions of dollars—make it prohibitive to restart or rectify major issues.

  2. AI as a Catalyst in Drug Development: Hybrid AI has the potential to revolutionize drug development by rapidly analyzing vast amounts of data, billions of times faster than human capabilities, to predict drug interactions, efficacy, and potential adverse events before clinical trials begin. By assessing the compatibility of medicinal compounds and the individualized effects on patients, AI can significantly reduce the risk of failure in drug development. This risk mitigation could lead to a drastic reduction in the traditional drug development timeline, potentially saving a multitude of drug candidates from unnecessary abandonment and bringing life-saving drugs to market more quickly and cost-effectively.

  3. Human and AI Collaboration in Drug Discovery: Despite misconceptions, AI is not set to replace human researchers but rather to augment the drug development process with its unparalleled speed and analytical prowess. Researchers will continue to play a vital role in scientific innovation, utilizing AI as a tool to access and leverage extensive scientific data, thus accelerating the pace of discovery. Trust in drugs developed with the aid of AI will be rooted in the expertise of the researchers, who will now be empowered to conduct their work with enhanced efficiency, precision, and a significantly lower risk of error, aiming to address urgent medical needs and save more lives in a shorter span of time.

CDC outlines first plan to address widespread health worker burnout

By Tina Reed - A new first-of-its-kind federal campaign targeting widespread burnout in the health care workforce aims to make it easier for providers to get mental health care without fear it could jeopardize their careers. Read Full Article…

VBA Article Summary

  1. Increased Scrutiny of Mental Health Inquiries: The CDC's National Institute for Occupational Safety and Health (NIOSH) is bringing attention to the issues arising from routine mental health screenings in high-stress jobs, following critical events like the Alaska Airlines incident. These inquiries have been shown to prevent workers from seeking the help they need due to fear of job loss, as noted by NIOSH Director John Howard. Professional bodies such as the American Medical Association advocate for the removal of such probing questions from licensing applications to encourage treatment for mental health and substance use without the risk of professional penalties.

  2. New Initiatives for Health Worker Well-being: NIOSH, in collaboration with the Dr. Lorna Breen Heroes Foundation, has launched a campaign to combat health worker burnout, influenced by the pandemic's strain on this workforce. This campaign, influenced by a 2022 law for health worker protection, shifts the focus from employee resilience to employer responsibility in organizing work to prevent burnout. The campaign underscores the importance of managerial roles in monitoring workloads using existing tools like the "signal report" in electronic health records to optimize work conditions for health workers.

  3. Balancing Safety and Stigma in Mental Health: While the safety of patients must be prioritized by assessing the current mental fitness of health workers, the new plan emphasizes the need to eliminate stigma-inducing questions about past mental health treatments from assessments. J. Corey Feist of the Dr. Lorna Breen Heroes Foundation highlights how "have you ever" questions reinforce fears that seeking mental health assistance will irreversibly tarnish a professional's career, suggesting that a balance needs to be struck between ensuring safety and encouraging help-seeking behavior without fear of stigma or job loss.