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Limited Medical Plans:Unlimited Possibilities
William KramerReliance Standard Life Insurance Company
March 22, 2007
Why should we care?
As Americans:Percentage of Nonelderly Americans Without Health Insurance Coverage, 1987-2004
Why should we care?
As Americans:
Uninsured Nonelderly Population by Family Poverty Status, 2004
Why should we care?
As Employers:
Annual Growth Rates for Health Insurance Premiums,
Workers Earnings, and Overall Inflation, 1988-2005
Why should we care?
As Benefits Producers:
Nonelderly Adult Uninsured Workers by Firm Size, 2004
What are options
Big GovernmentMore lawsMore taxes
Big InsuranceHigher deductibles/HSAs
Limited Medical
History of Limited Medical
25-plus years
Origins in Big-Box, Retail, Restaurant industries
Designed for part-time, seasonal, hourly and temporary employees
Differentiator for employers fighting turnover, lost productivity
Nonelderly Adult Uninsured Workers by Industry, 2004
Workers in wholesale and retail trade and personal services account for 63.4 percent of all uninsured workers!
Nonelderly Adult Uninsured
Workers by Work Status, 2003
More than half of all working uninsured are employed full time!
Today’s Plans
Guaranteed acceptance/no adverse selection
No Pre-Ex
No deductibles
Wellness care included
Rx discounts
Ancillary and dependent coverages available
COBRA eligible
HIPAA, ERISA compliant
Why Limited Medical WorksOut-of-Pocket Spending as a Percent of Total Private Spending, 1960-2014
Health insurance has replaced out of pocket spending on medical expense
Percentage of Covered Workers Facing Various HMO Copayment Amounts for Physician Office Visits, 1996-2005
Doctor copays are going up!
Why Limited Medical Works
Average Copayments Per Prescription in Multi-Tier Arrangements, 2000-2005
Drug costs are outpacing other health expenses
Why Limited Medical Works
What’s Next?
Increasing, maybe explosive growth
Mini-Major PlansSplit the difference
Gap PlansGet employees to a place where they can
participate in their Major Medical
How to Evaluate
1 2 3 45
Unfavorable Favorable
Access
1 2 3 45
Barriers to Access Open Access
Flexibility
1 2 3 4 5
Off the shelf Customized to my work force and
company culture
Value
1 2 3 4 5
Out of reach/Irrelevant Affordable/Valuable
Ease of Administration
1 2 3 4 5
High-touch Turnkey
How to Evaluate
15-20 = BUY IT! This is probably a best-in-class plan
12-15 = Consider it You may want to shop around or push back
8-12 = Keep an eye on it Something about the case could change, but it’s
not a match right now
0-8 = Forget it
Q&A
