Businesses face volatile insurance market

Uncertainty and volatility in the health insurance marketplace for individuals in Nevada has companies that broker health benefits scrambling as more and more small businesses in Northern Nevada seek coverage for their employees.

Attempts to repeal and replace the Affordable Care Act, coupled with Anthem and Prominence Health Plan’s decisions to no longer offer individual coverage, have rocked the insurance markets in Nevada. Health insurance brokers are taking more and more calls from small businesses who want to provide healthcare coverage as individual plans dry up and rates spike.

Alex Sampson, broker for Health Benefits Associates, which provides individual and business health care coverage, says he’s been spending much of his time recently brokering coverage for small businesses as individual coverage plans continue to disintegrate.

“That has been huge,” Sampson says. “Those individual plans have been going away, and it’s been a reason for people who might have gone away from a group option in the past to look at it again.

“For employers, it’s making health plans even more valuable — in the past people were saying they could go to the exchange and get something better. Now that is definitely not the case,” Sampson adds.

Melissa Davies, benefit solutions consultant with Clark & Associates, started her workday one morning last week talking with a small business owner who wanted to convert employees over to a small business plan after moving them onto individual plans in 2014. It’s a call she’s fielding more often these days.

“Employer plans are the only place they can get decent rates and access,” Davies says. “It’s very nerve-wracking for people who don’t have access to employer group plans. But they are really trying to work on stabilizing the individual marketplace.”

Yeraldin Deavila, public information officer for the Nevada Division of Insurance, says the small group market in Nevada remains healthy and competitive and is unaffected by changes and uncertainty in the individual market. Anthem’s announcement that it’s pulling out of the individual marketplace has no negative effect on small group coverage, Deavilla adds.

Although individual health insurance plans may be battered as of late, employers who provide health insurance coverage to their employees have no need to worry, Davies says.

“Currently there is no real need for employers to be nervous — there has not been anything that changed; it’s still status quo. They should keep moving forward as they have been,” she says.

In fact, Davies notes, certain aspects of proposed legislation would actually help the employer insurance marketplace and relieve employers of certain cumbersome responsibilities enacted by the Affordable Care Act. Employers have been on a bit of a roller coaster the past few years since mandatory health insurance went into effect, Davies says. Open enrollment under the ACA went into effect in October 2013.

Davies says the National Association of Health Underwriters is working daily to help the current administration in Washington draft legislation that would stabilize the volatile health insurance marketplace. NAHU Chief Executive Officer Janet Trautwein said in a March press release that the organization’s goal is to help all Americans receive affordable coverage.

“We look forward to continuing our dialogue with members of Congress and the administration on the implementation of health care reforms that reduce cost and encourage competition,” Trautwein said.

And when companies such as Anthem and Prominence pare back their coverage offerings for individual Nevada residents, it stifles competition and leads to increased individual rates, says Sampson of Health Benefits Associates. It does, however, boost competition amongst providers of small business insurance plans as more small business owners step in and try to provide health insurance coverage for their employees.

“Anthem going away affects the whole market,” he says. “Fewer choices mean higher prices. But with small business options and more people going to them, it means more insurance companies competing for business, and that means lower prices.

“The most important thing is to convert as many individuals over to small business plans or to get individuals into plans that they can afford,” Sampson adds. “That is mostly what we have been doing, transferring people over. We have not had many new clients. We are just trying to find a good place for individuals to land with the ridiculous rate increases.”

Health insurance remains a primary retention tool for Northern Nevada businesses. It’s one of the reasons some people take a job bucking boxes at the United Parcel Service hub in Sparks, or fulfilling orders at Amazon’s new distribution facility at Lemmon Drive. Those companies offer attractive benefit packages that for some are more important than a weekly paycheck.

“Nowadays for employers, there is so much competition in the job market that (benefits) are a huge retention and attraction tool for new employees,” Davies says. “The main thing we are dealing with is trying to get people covered in the best way possible.

“We definitely have to think outside of the box to put together creative solutions that meet employer budgets and also offer employees good coverage and benefits that keep them happy. That is the name of the game for us and for employers.”