Category Archives: Insurance

Obamacare Final Tally For State: Good First Year, Much More Needed

by Categorized: Government, Health Care, Insurance Date:

The final numbers are in for Connecticut residents signing up for health care at Access Health CT, the state’s exchange under the Affordable Care Act. Results for people who met the March 31 deadline show the agency exceeded its goals with a surprisingly high number of Medicaid enrollees.

What we don’t know is how many of the newly enrolled Obamacare customers were previously uninsured. But we do know that on that score, the state still has a long way to go.

Nationally, President Obama announced Thursday that the state exchanges, mostly run by the federal government, reached 8 million enrollees by mid-April — exceeding a 2013 Congressional Budget Office estimate of 7 million. And he said 28 percent were between 18 and 35.

Click here for a White House fact sheet on Obamacare progress.

We’re still hearing reports of problems with the system, including very high prices for people on the individual market who are not eligible for subsidies, and concerns by many that they must keep their incomes under key thresholds.

It’s too soon to say whether the mix of enrollees in the private plans — age groups and health profiles — will be adequate to avert sharp increases for 2015. But with an estimated 47 million Americans lacking health coverage, it’s clear that Obamacare in 2015 will have to accelerate.


  • Total Enrolled: 208,301
  • Unofficial Goal Set In 2013: 100,000-130,000
  • Total Uninsured In Connecticut Before Obamacare: About 300,000
  • Total Uninsured Now: ?????
  • Next Open Enrollment Date for 2015 Coverage: Nov. 15, 2014
  • Who Can Still Enroll In 2014? Residents with life changes such as marriage, divorce, birth, adoption or loss of employer’s insurance coverage


  • Total Enrolled In Private Plans Through Exchange: 78,713
  • Unofficial Goal Set In 2013: 70,000
  • Federal Target for Private-Plan Enrollment In CT: 33,000
  • Private Plan Enrollees Receiving Federal Subsidy: 61,400
  • Enrolled And Later Dropped Out (not counted in total): About 7,000


  • Total Enrolled In Medicaid: 129,588
  • Unofficial Goal Set In 2013: 30,000





Aetna Pitching At Fenway Park In New Massachusetts Push

by Categorized: Entertainment/Tourism, Health Care, Insurance Date:


It’s Opening Day at Fenway Park in Boston and Aetna is one of the new players on the field. The Hartford-based health insurer, looking to push deeper into the Massachusetts market for large and midsize company plans, figured there’s no better place than the home of the World Series champions.

Aetna at Fenway Jody Osko Lewis photo courtesy of Aetna

Aetna at Fenway
Jody Osko Lewis photo courtesy of Aetna

Aetna’s ad deal with the Red Sox includes a 16-foot center field sign for the whole season; the Aetna logo behind home plate for 15 games; and the right to call itself a “proud sponsor of the Red Sox.”

Fenway will also schedule an Aetna Day at Fenway Park on a date to be announced (no word on whether they’re giving out Aetna yoga mats signed by Chief Meditation Officer Mark Bertolini).

Payment terms were not disclosed and Aetna might add more promotions as the season progresses.

Aetna may have spurned most of the states’ Obamacare exchanges, but the Bay State represents a major opportunity. No other national firm operates in the corporate health plan market there on its own, without a local partnership.

“We want to significantly grow our membership base in Massachusetts and to do that we are investing in a greater presence in that market, securing office space, hiring new managers for sales and network, and additional staff there,” spokeswoman Susan Millerick said.

Aetna is one of at least two large Connecticut-based organizations announcing a big presence in Fenway this year. The other is Foxwoods Resort Casino, a longtime Fenway presence, which just took the main ad position on the Green Monster.


Magellan Acquisition Highlights Pharmacy Management Profits

by Categorized: Corporate finance, Health Care, Insurance Date:

It really says something that the deal announced today by Magellan Health Services Inc. to buy Newport, R.I.-based CDMI LLC seems routine.

Consider the price Magellan is paying and what that tells us about the profits at CDMI, and at pharmacy management firms generally.

Avon-based Magellan will pay as much as $370 million for the pharma management firm that has health plans as clients. The base price is $205 million in cash and stock and the incentives total $165 million, based on profits and customer retention over the next three years.

With CDMI’s 2013 net revenues totaling $43 million, that’s 8.6 times sales — compared with Magellan’s own market value, at about 50 percent of sales.

And that means that if CDMI had a net profit last year of, say, 30 percent of sales, or $13 million `– a healthy figure — the full price Magellan could pay would translate to a price-to-earnings ratio of 28.6.  A net profit of 20 percent would mean Magellan is paying a whopping 43 times net earnings.

That compares with Magellan’s own value at 13 times trailing 12-month net profits, as the company earned $125 million in 2013.

So CDMI is hugely profitable and it’s not the only privately owned health management or underwriting consultancy that can make that claim. Last year the CEO of South Windsor-based Medical Risk Managers Inc., The No. 1 company among small employers for the Courant/Fox CT Top Workplace awards in 2013, said his firm was more profitable than Google — which had a 31 percent margin.

That’s a great industry for Connecticut to nurture and for companies such as Magellan and Aetna to acquire.




Frontier Adds Captive Insurance Office To Stamford HQ

by Categorized: Insurance, Telecommunications Date:

Frontier Communications, the Stamford-based telecom company that has a deal to buy AT&T’s wireline business in Connecticut, will locate its captive insurance unit at its Connecticut headquarters.

Captive insurance is basically a separate business with an insurance license but rather than selling coverage to the public, it takes on risk for the company that owns it.

The announcement that Frontier Services Corp. will be in Connecticut, made by Gov. Dannel P. Malloy, does not mean a significant number of direct new jobs. But it advances the state’s goal of attracting captive insurers, in part to help the parent companies.  A new state law enabling captive licensing was adopted in 2011 and a trade group formed.

Frontier is the state’s fourth captive insurance company.

“Giving employers the tools they need to manage their costs and re-invest in their employees and products is a commitment we have made from day one,”  Malloy said in a written statement.

Frontier, with $5 billion in annual revenue, operates in 27 states and has 200 people at its headquarters. The AT&T deal, which requires regulatory approval, would add 2,700 Connecticut employees.


Warren Buffett’s Billion-Dollar Layup Based In Connecticut

by Categorized: Insurance, Media Date:

Before Warren Buffett offered $1 billion for anyone who filled out a perfect NCAA March Madness bracket, he turned to one of his Connecticut insurance companies to make sure it was a safe bet.

And it’s about as safe as a bet can be. ESPN, after 16 years and 30 million entries, has never seen a perfect bracket, spokesman Mike Humes said Wednesday.

The Oracle of Omaha could afford to be wrong, of course, with $50 billion or so to his name. But the offer made Tuesday by Quicken Loans and Buffett’s Berkshire Hathaway Inc., is backed by an insurance policy.  It’s similar to a hole-in-one contest at a charity golf tournament, where an insurer backs the big payout by the sponsor.

Neither Berkshire nor Quicken would talk about the deal, including the premium Quicken paid to Berkshire. But sources confirmed the policy in the billion-dollar bracket challenge is from Berkshire Hathaway Reinsurance, based in Stamford.

There, actuaries would have done the same calculations that were produced last year by DePaul University math professor Jay Bergen, whose YouTube video shows him writing out the 19-digit number, 9.2 quintillion.

That is, in a 64-team, single-elimination bracket, there are that many possible game outcomes. And that doesn’t even count the play-in games.

Such a number is so big there’s no way to imagine it. But Berkshire Re would also have calculated the odds of a perfect bracket for fans who know the game and use the seedings. Bergen calculated that as 1 in 128 billion.

That means if every American filled out a bracket every single year, there would be one winner in 400 years, as USA Today reported a year ago.

ESPN, which had 8.2 million brackets last year, not only has never had a clean one, it rarely even has one with all of the Sweet 16 teams correct.

Think about it: To correctly pick all 16 of the second round winners, a bracketologist only needs to pick those teams to win the first round, then correctly mark down the 16 second-round games. Most of us get seven or eight, maybe 10.

In 2011, not one of ESPN’s 5.9 million brackets had all 16.

So it’s an odd insurance product, but that’s part of the business. Berkshire Hathaway also owns Gen Re, or General Reinsurance, in Stamford, which said it did not do the bracket deal, and GEICO — but this was no job for the gekko.

With Goldie Hawn At Davos, Aetna’s Bertolini Brings Mindfulness To Mainstream

by Categorized: Education, Health Care, Insurance Date:

You could say Mark T. Bertolini knows about stress, not only from his 24/7 job as Aetna CEO but also as a kidney donor to his son who nearly died, and survivor of a ski accident that left him partly paralyzed.

He’s arguably the most prominent advocate of naturopathic medicine, yoga and meditation in corporate America.

Now Bertolini is bringing Hollywood glitz to the science of de-stressing, teaming up with Goldie Hawn, a fellow mindfulness maven who also believes in the evidence behind emotional awareness for improved health.

Hawn, left, with Julia Roberts and Gwyneth Paltrow at the San Penn & Friends HELP HAITI HOME gala in Beverly Hills Jan. 11.  Getty Images

Hawn, left, with Julia Roberts and Gwyneth Paltrow at the San Penn & Friends HELP HAITI HOME gala in Beverly Hills Jan. 11.
Getty Images

At the World Economic Forum at Davos, Switzerland on Thursday, the CEO and the Academy Award-winning comedic actress will advance meditation and mindfulness in a discussion moderated by Arianna Huffington, who’s written a book on the topic.  Aetna and Hawn will launch a partnership designed to expand an education-based stress reduction program called MindUP that’s sponsored by The Hawn Foundation.

Hartford-based Aetna and The Hawn Foundation, of Miami Beach, London and Santa Monica, don’t have a formal plan for their collaboration, dubbed “Mindful Works.”  “It’s in the very preliminary stages of the relationship. It’s open-ended at this point,” Aetna spokesman Ethan Slavin said.

What’s all this about? “MindUP consists of tools and strategies based on neuroscience, social and emotional learning, mindfulness and positive psychology to help people center, focus and thrive,” Aetna and the foundation said in a joint release.

Mindfulness, with its roots in Buddhist meditation, is a hot topic in psychotherapy. Basically it teaches people to maintain hyper-awareness of their feelings and sensations, and to focus intensely in the present moment.

Bertolini, a regular at Davos and other global forums, typically talks about health care technology or changing over to a results-based payment system for medical services, but audiences have certainly heard him on alternative health.  He’s also scheduled this week to speak about “hyperconnectivity,” the fast-advancing world of apps and other ways to link medical information.

HC ct-Mark-Bertolini.jpg

He’ll still be the straight man in the Thursday show as he pushes the science behind mindfulness, which Aetna is leading.

It’s not a new push. Back in 2010 and 2011, Aetna divided employees into quintiles by stress markers such as heart rate, and found that the most stressed group had average medical costs $2,500 a year higher than the least-stressed group, Bertolini said at a conference in Arizona last month:

We put them through mindfulness and yoga training for 12 weeks and we saw the costs drop like a rock in the post-testing, so we know this stuff works,” Bertolini said.

The company pegged the added cost for the most-stressed employees in the study of 458 people at “nearly $2,000″ in a 2012 press release, but the point is made. That figure even seems a bit low if you consider that obesity could be linked to stress.

The company has had 6,000 employees go through its “Mindfulness at Work” training, and offers it to all of its clients, including employers that use Aetna to administer self-insured plans. So far, mindfulness has not changed the way Aetna actually approves medical procedures but that could happen.

“We’ve got to pioneer somewhere…We’ve got to challenge the norm,” Bertolini said on a video of the Arizona conference. “And so we believe in this, it’s just building the evidence base.”

And building the fan base. I see Warren Beatty playing Bertolini in the movie and Hawn playing herself. Daughter Kate Hudson can play the over-stressed young professional.

It’s a modern sequel to Shampoo. Call it  “The Mindful Conditioner.”  The storyline: On the day Obamacare goes into effect, a health insurance executive comes to terms with his love of alternative medicine as he’s confronted by multiple yoga partners.



Malloy: Obama’s Health Plan Fix ‘Doesn’t Work In Connecticut’

by Categorized: Government, Health Care, Insurance, Politics Date:

Gov. Dannel P. Malloy announced Friday that the state won’t allow insurance companies to reopen health plans through 2014 that did not comply with the Affordable Care Act and had been retired.

The decision was largely symbolic because insurance companies have already declined to offer the policies.  Malloy confirmed Friday that the companies would not reopen them even if they were permitted.

The move affects policies on the individual market only, not those sold through employers. Just under 53,000 Connecticut people are in policies that insurers are ending, either because their plans don’t comply with Obamacare standards, or for other reasons.

In a last-ditch hope for a fix on Nov. 14, President Barack Obama asked states to allow those plans to continue.  But despite criticism from Republicans aimed at Malloy, it’s unlikely that the governor could have changed the picture. Even if those policies were to continue for an extra year, prices would have been higher, Malloy said Friday.

“The solution offered by the president a week ago doesn’t work in Connecticut,” Malloy said in an appearance Friday morning at the Connecticut Convention Center, where he opened the Connecticut International Auto Show. “It would disrupt the industry, but more important, the industry made it clear that they were not going to offer these policies.”

Malloy said he asked Connecticut’s health exchange, Access Health CT, for a one-week extension of the deadline to sign up for plans that take effect Jan. 1, to Dec. 22, to help accommodate people shut out of plans.


(figures show number of people in affected individual plans, not number of plans)

Total covered: 108,287 (four companies)

In grandfathered pre-Obamacare plans that are being moved to ACA-compliant plans: 25,097

In grandfathered pre-Obamacare plans that are continuing: 14,130

In non-exempt plans that accepted option for early renewal to continue in 2014: 30,459 (41,169 were offered)

In non-exempt plans that are migrating to ACA-compliant plans: 38,601

Malloy joins governors in a number of other states, including Massachusetts, who have already reached the same conclusion. Typically, according to the Washington Post, states that are accepting the fix are the ones that did not embrace health reform and do not have their own exchanges operating.

Friday’s events provided rich political intrigue. Obama is able to say he tried to offer a solution but the states wouldn’t take it. Democratic governors such as Malloy — who is likely to seek re-election next year —  are able to distance themselves from a Democratic president whose popularity is plummeting due to this very issue.

And Republicans took the opportunity to slam Malloy for rejecting a fix that they said would have helped Connecticut residents — even though Malloy had no power to compel insurers to offer plans they didn’t want to offer.

“Instead of acting on my call to bring the General Assembly into session to amend state law so that these policies could be continued, the Governor rejected my request and his insurance commissioner has told us to ‘forget about the numbers.’” said Sen. John McKinney, the state Senate majority leader. “But we can’t do that.  Unfortunately for Governor Malloy, these ‘numbers’ represent real people.”

Based on figures released by Malloy’s office Friday, there are 52,988 Connecticut residents whose plans were dropped by insurers. That includes 27,891 people in 16,204 individual policies that were not compliant with the Affordable Care Act, but could have been extended for another year if insurers had opted to do so.  Another 25,097 people in 15,057 individual policies were in plans that could have continued indefinitely because they pre-dated Obamacare, but were dropped by insurers.

GOP state chairman Jerry Labriola Jr. said in a written release that Malloy  is “refusing to accept responsibility….By deciding to do nothing, Governor Malloy made sure that those with canceled policies will face higher costs for less coverage.”

They may have a legitimate beef with Obamacare for shutting out some customers’ policies but the fix was simply not workable in a state that carefully regulates the market. It’s too late for regulators to reconsider closed plans in time for a January enrollment.

And, insurers said, it might have led to higher prices on some other plans as insurers scrambled to rebalance their offerings.

“To those who think we should have a special session because there’s some magical way for us to fix the issue, I say you’re wrong,” Malloy said in response to the GOP critics.

For people closed out of old plans, the bad news is that prices on the individual market are up by 15 percent to 200 percent, Malloy said.  The good news is that many residents are eligible for federal subsidies — households of four with incomes as high as $94,000, and one-person households with income as high as $44,000.

“We’re going to work with people, walk them through their options, and get them covered either on the exchange or with a private plan that makes sense for their needs,” he said.

Keith Stover, a spokesman for the Connecticut Association of Health Plans, an industry loybbying group, hailed Malloy’s announcement. “We think staying the course is the right and wise decision,” he said.

Officials at Anthem Blue Cross and Blue Shield of Connecticut, the state’s largest insurer with 46,000 individual members, and ConnectiCare, the third largest with 12,700, issued statements supporting Malloy’s decision.

Connecticut was already among the states that allowed insurers to continue non-compliant plans into 2014 — if they went through the regulatory process. The companies and customers that did continue those plans –19,251 policies covering 30,459 people — are unaffected by Friday’s announcement. Those numbers can still rise over the next several days if more people who were offered extensions elect to take them.

CT Obamacare: Low On Young Adults, Better Than Feds

by Categorized: Government, Health Care, Insurance Date:

NOTE:  Click here for an updated version of this post, including details of Connecticut Insurance Commissioner Thomas Leonardi’s Oval Office meeting with Obama Wednesday on the subject of insurers dropping plans.

It looks like Access Health CT and the three insurers in the individual Obamacare exchange will have to step up their marketing to young adults.

Or, they can just hope that many more people age 18 to 34 are procrastinators waiting to sign up for health coverage on the exchange.

Through Nov. 14, there were 7,092 people enrolled in a private health plan, according to new figures from Access Health CT.   Of those, 1,322, or 18.6 percent, were between 18 and 34, a proportion that won’t cut it for insurers for most plans.

Click here to see the breakdown by age, insurer and type of coverage. Chart provided by Access Health CT. “QHP” is a qualified private health plan.

That group is key because they’re typically healthier, and requiring that they buy coverage is a way for insurers to keep the overall cost down. It’s too early to fret about the mix, and we know whether the group that did sign up is in fact healthier than the population as a whole. It’s possible that sicker young adults signed up first.

The largest age group signing up by far is 55-64, with 2,767 enrolled, or 39 percent of the total in the first six weeks of the Obamacare exchage operations.

Among health plans, Anthem Blue Cross and Blue Shield, with 62 percent, had the highest share. ConnectiCare had 35 percent and HealthyCT, a new plan formed by a group of doctors, had 2.4 percent, a total of 168 people.

Nationally, Connecticut was in the top three best performing states as of Nov. 1, when figures by state were released. The numbers are not comparable to Access Health CT’s figures because the federal report tallied it differently.

Report: CT Ranks No. 3 In Employer-Based Health Coverage As All States Slip

by Categorized: Health Care, Insurance Date:

One of the advantages of pervasive corporate culture is health coverage — and Connecticut ranks No. 3 in the percentage of non-elderly people covered by a employer-based health plan, a new report shows.

This state had 69.7 percent of the under-65 population covered by policies from a workplace in 2011-12, the report by the Economic Policy Institute shows. That trails only Massachusetts (71 percent) and New Hampshire (70 percent).

But all states have seen the numbers slip. Nationally, the decline from 2000-01 to 2011-12 was more than 10 percentage points, from 68.5 percent to 58.4 percent  — a staggering 13 million fewer people covered, even as the population has increased.

Connecticut’s decline has been smaller, 8.3 percentage points, from 78 percent over the 12-year period. That means 155,000 fewer people have coverage through their own or a family member’s workplace.

The lowest-covered state in employer-based health insurance is New Mexico, at 47 percent — not as low as might be expected, all things considered, an interactive map by EPI shows.

To no surprise, the declines have been larger for lower-paid and less educated people. Among people with a high school education only, half have coverage through work, down from 67 percent 12 years ago. More than three-quarters of those with a college degree (and not a graduate degree) are covered, and the decline in that group has been just 7.4 percentage points.

The obvious point by the left-leaning EPI is that given the declines, the nation needs to keep pushing ahead with more government-sponsored plans coverage, chiefly Medicaid, as well as subsidies for individual plans, which is one of the main points of Obamacare.

Obamacare has also helped stanch the declines in the last couple of years, the report said, by adding adult children through age 25 to parents’ plans.

C.M. Smith Brokerage Moving From Glastonbury To Hartford

by Categorized: Health Care, Insurance, Real Estate Date:

After 40 years of growth in Glastonbury, insurance broker and services firm C.M. Smith Agency Inc. is moving to downtown Hartford later this month as it looks to retain and attract more top talent in the Obamacare era.

The agency, which includes a separately owned consulting business for retirement plans, brings a total of 40 employees to 100 Pearl St. from its current digs at Salmon Brook, off Hebron Avenue.  With a lease for 8,300 square feet, the deal isn’t huge by commercial real estate standards but it’s significant because of why it’s happening and what it says about the health benefits industry.

John F. O'Connell Jr., left, and Bret Maffett of C.M. Smith Agency.  Handout photo

John F. O’Connell Jr., left, and Bret Maffett of C.M. Smith Agency.
Handout photo

“Being down where the action is will position us better,” said John F. O’Connell Jr., president of C.M. Smith Agency.

It will matter, he said, not only for its proximity to health insurers and other big companies, but for its location in the region.  The firm largely advises midsize and big companies on health insurance, often setting up self-insured plans for its clients — complete with actuarial work.

“Our business model is evolving very rapidly and in a positive way,” O’Connell said, adding that the Hartford location “will allow us to continue to draw really super highly skilled folks.”

O’Connell became a partner in the firm 18 years ago, when it was run by Charles H. Smith when the agency was more local, with eight employees. Now, O’Connell said, with a larger and more specialized staff that includes a former Aetna chief medical officer, people come from all over.

“It would be really tough for me to draw a skilled person from Granby to come all the way to Glastonbury,” he said.

For O’Connell and Bret Maffett, owner of the retirement plans side of the business, the cost per square foot in the lease, brokered by CB Richard Ellis, was about the same as in Glastonbury when the cost of parking and higher taxes is included.  That’s an indication that building owners in downtown Hartford are offering aggressive incentives.

Health care reform has been good for the Smith agency, O’Connell said, because client companies, especially those transitioning to self-insured health plans, need significant expertise. There will be a shakeout of brokerages, he and others say, and he expects a “handsomely increased” staff size over the next five years, though he wouldn’t give a forecast.

An acquisition, which would be the firm’s first, is not out of the question, but O’Connell said Smith will remain a boutique firm in the industry, and there’s a limit to a higher profile it expects to see in its new location.”You’re never going to see a C.M. Smith billboard,” he said.

Separately, the U.S. actuarial practice of  Oliver Wyman has opened an office at 20 Church St. in downtown Hartford, where its three sister firms under the March & McLennan Cos. — Marsh, Guy Carpenter and Mercer — already have offices.

The Oliver Wyman office for now has only its manager, Guillaume Briere-Giroux, who moved from Towers Watson’s risk consulting practice in Simsbury, but Briere-Giroux said he’s hiring staff as the office ramps up to consult with life and annuity companies. He declined to say how many people he expects to hire, adding that the company’s office space in the Stilts Building is flexible.