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By: Nicola Crean, CHS Marketing Coordinator

Creating an accessible healthcare marketplace is one objective of the Healthcare Reform Act. The government, in conjunction with the states, has been working towards creating insurance exchanges that will provide additional coverage choices for individuals.

The number of choices offered, in addition to the type of coverage available to individuals will vary depending on where they live. Some states have seen an influx of both new and old carriers developing coverage plans to offer, while others are limited in the selection available within the marketplace.

Many state policies are to blame for carriers avoiding entering into this new market. A New York Times’ article describes the situation in Maine, which would be one state with limited choices when it comes to their marketplace. Since the population is older and the state has strict regulations to follow, many carriers are avoiding this type of environment.

“What we’re seeing is a reflection of the market that already exists,” reported Timothy Jost, a law professor at Washington and Lee University, in an article published in the New York Times’ article.

The flip side of the situation in Maine is that some individuals residing in other places may feel the pressure of dealing with too many choices. A combination of new and inexperienced carriers may pose an entirely different obstacle to overcome.

Additionally, states have had to decide who will operate their healthcare marketplace. Approximately 16 states have taken on the role of handing the maintenance and regulation themselves, while many others have deferred responsibility to the government. Some states have even developed a plan to take over the management of these plans within a couple of years.

With such varying factors when it comes to the new healthcare exchange operations, many Americans are left in the dark as to what options will truly be available to them. According to the April Kaiser Health Tracking Poll, about half of Americans are unaware of how the Affordable Care Act will affect them. In fact, 40 percent of individuals did not even know that the law was still in existence.

This tracking poll clearly demonstrates the lack of knowledge among Americans regarding what is to come in 2014.

“We haven’t seen a lot of energy from the administration on public education,” said Henry J. Aaron, a health-policy analyst at the Brookings Institution in Washington in an article published on “They ceded the field to those who were largely hostile to the bill to frame it in the public’s mind.”

Experts are concerned that this lack of understanding among the public about the health care reform laws, especially with regards to the health care exchanges, will potentially affect the act’s success. It is only recently that the government has put dollars behind outreach to Americans in order to promote the changing laws.

“Our outreach will kick into high gear this summer leading into the fall, when we’ll be talking to Americans across the country to prepare them to enroll in coverage beginning October 1,” said Joanne Peters, an HHS spokeswoman, in an e-mail to “Our deliberative tactics build on the lessons we’ve learned, including reaching people with the right message at the right time, when it’s time for them to act.”

The hope is that people will be receptive towards the government’s attempt to inform the public. However, tracking polls show that many Americans are able to tune out the constant chatter about the Healthcare Reform. With regards to state-specific exchanges, a lot of the burden will be placed on individuals to research and gain an understanding of the options available to them.

This upcoming open enrollment season will be the first time that many regulations are officially in place. There will undoubtedly be some expected bumps in the road, but experts say that will not determine the success of Obamacare or the healthcare marketplaces.

“A rush to judgment will be just that,” said Dan Mendelson, the Chief Executive of Avalere Health in a NY Times article. “It’s not going to be possible in 2014 to make a strong valid judgment of whether the exchanges are working or not.”


By: Nicola Crean, CHS Marketing Coordinator

Battling the cost of health care has been a major focus for companies, especially with open enrollment season quickly approaching. Employers have considered many alternatives that would reduce costs for the company, while still being able to offer medical benefits to employees.

Wellness programs have been a widely used tool that aims at cultivating a healthier workplace. As part of the many changes coming in 2014 with Obamacare, these health programs will now face a new set of regulations that companies must be prepared for.

Essentially, wellness programs have provided various incentives to promote weight loss, exercise and even quitting smoking. The end result is ultimately to reduce medical expenses that occur as the result of chronic illnesses.

Reports have demonstrated a mixture of responses from employees regarding these programs. A recent study released by researchers at the RAND Corp. demonstrates that there is only a modest benefit to these programs within the workplace.

After collecting information from over 600 companies, the study concluded that there is not a dramatic difference in health or medical costs that can be attributed to corporate sponsored wellness programs. An article published in Reuters reports that workers who participated in the program saved approximately $2.38 per month compared to non-participants.

The RAND Corp. study was considered when the U.S. Department of Labor and the Department of Health and Human Services were developing a proposal for the wellness program regulations. When considering why these programs were not meeting their success potential, experts believed that there was a lack of motivation by employees to participate.

“The strongest predictor of whether someone will lose weight or stop smoking is how motivated they are,” Al Lewis, president of the Disease Management Purchasing Consortium International, said in a Rueters article. “Since the programs are usually voluntary, the most motivated employees sign up. That makes it impossible to credit the programs with success in smoking cessation or weight loss rather than the employees’ motivation.”

What motivates workers varies from one individual to another. The ACA’s wellness program regulations took that into consideration and left some flexibility within the standards to ensure that companies can create programs that are targeted towards their employees.

“Employers know best their own workforce, business models, cost structures and cultures, making them the most knowledgeable regarding how wellness programs should be designed and administered to succeed,” said Cara Woodson Welch, vice president for WorldatWork, in an article published in HRE online. “Fortunately, the final rules take into account many of our recommendations for ensuring employers retain this needed flexibility.”

So what changes must companies prepare for come 2014? First, the Regulations on Incentives of Nondiscriminatory Wellness Programs in Group Health Plans divide the programs into two categories, according to an article publish in Lexology. The Participatory Wellness Programs do not provide any type of reward or incentive. Instead these programs offer reimbursement of a fitness center membership, for example.

The Health-Contingent Wellness Programs are divided up into activity-only and outcome-based programs. These types of programs have a set standard that individuals must meet in order to obtain some type of reward. The activity-only programs focuses on exercise or dieting, while the outcome-based plans look at changing behavior by quitting smoking, which can ultimately lead to health benefits.

When it comes to the Health-Contingent Wellness Programs, there are five specific requirements that must be met by both activity-only and outcome-based programs. The following is a list compiled by an article published in Lexology that describes these requirements.

  1. Frequency of Opportunity to Qualify: Employees must be able to qualify at least once a year for the full reward that is offered.
  2. Size of Reward: The financial reward amount cannot exceed 30 percent of the total cost of the employee coverage plan. For programs that specifically target prevention of smoking, the total cost cannot exceed 50 percent.
  3. Reasonable Design: Program must be realistic for participants to complete in order to improve their level of health.
  4. Uniform Availability and Reasonable Alternative Standards: There must be a standard that is set for all individuals who participate in the program, along with the same reward being offered to everyone. Accommodations must be made for those who cannot physically meet the standard that is set.
  5. Notice of Availability of Reasonable Alternative Standard: Companies must disclose the alternative standards that are set in order to qualify for the reward.

“We appreciate that the final rules for the most part refrain from establishing rigid requirements for wellness plans and instead will allow employers to determine the appropriate design for rewards that employers deem will work best for their workforce,” said Welch.

Unlike many of the regulations that the health care industry will face in January 2014, the wellness incentive regulations allow for more discretion to be used. Overall, the primary goal is to ensure that all individuals have an opportunity to be motivated and participate in the program, which can ultimately lead to a reduction in medical expenses across the board.


By: Chacko Kurian

Regulations depend on carrots and sticks. If you don’t pay your taxes, there will be serious consequences – the stick. If you buy a home with a home loan, we’ll let you take the interest payment deduction on your taxes – the carrot. The HITECH Act has a number of sticks associated with the security of Protected Health Information (PHI). We at CHS will be addressing the issue of security of PHI in forthcoming articles. There is, under some circumstances, one link in the security chain that no regulation can affect -the uninformed behavior of the user. This article addresses one method where cyber criminals make unwitting users partners in a security breach.

Prior to founding Apple Computers, the Steves (Wozniak and Jobs) could be found ripping off Ma Bell using a blue box to make long distance phone calls (domestic and international) for free. The subculture that reveled in this activity called “phreaking” was probably the progenitor of the subculture of hackers who, today, like to hack computer systems just because they’re there. There is the story of Steve Woz(niak) actually making a “phreak” phone call to the Vatican and asking to speak to the Pope while pretending to be Henry Kissinger with a think German accent. These are the guys who later found legal ways to take your money.

Before the age of digital telephone switching systems, telephone switches reset trunk (long distance) lines with a tone at a specific frequency – 2600Hz. This meant that the trunk line was disconnected at one end and available for dialing at the other end. The dialing was also accomplished by tones at preset multiple frequencies. How did one get those frequencies? Legend has it that the 2600Hz frequency was discovered by accident by Joe Engressia, known among phreakers as ‘Joybubbles’, at the age of 7! He was apparently able to whistle at that frequency and so attach himself to the dialing end of an available long distance line.

But how does one progress from knowing that you could get a trunk line to using it to make free long distance calls. In 1954, the then undivided Bell System published an article in the Bell System Technical Journal about the basics of signaling using multi-frequency tones. This piece of information by itself was of little use. The second and final piece of the puzzle was published, again courtesy of Ma Bell, in the November 1960. Bell System Technical Journal in an article called “Signaling systems for control of telephone switching”. This article published the actual multi-frequency tones used to control the switches. From that information to the creation of the reputed “Blue Box” that became a clandestine product was a short step. With one of these boxes, anybody was able pick up a phone and make free long distance calls.

To be able to win this questionable prize, the phreaker required two pieces of information and they were found in two locations, but once they were combined, the information became quite powerful. Today – cybercriminals put two pieces of information discovered from different locations together to achieve their nefarious goals..

Spear Phishing is the technique by which pieces of information stolen from different locations are put together, by cybercriminals, to steal your identity, your money and anything of value. How does this work? Unlike the shot gun approach taken by those Nigerian scam artists who send out millions of emails, the Spear Phisher is looking for prey with a small email blast to very targeted prospects. All they need to start the process is one piece of information – your email address and sometimes your name. They don’t need anything like a credit card number, the password to your on-line bank account or your social security number– well, not yet. The attack is quick and over in less than a day, before security and software companies have an opportunity to react.

A typical Spear Phishing attack starts with an email that comes to you and looks something like this, courtesy of the Microsoft Safety and Security center

Remember they already have your email address and sometimes your name so the “Hello” salutation is not so innocuous. It looks very familiar but the highlighted items should make you suspicious. If you examine the links you will find that they link to unsecured and unfamiliar sites as shown below:

Once you click on the link and enter the information they’re asking for, they’ve got you.

Another variation of this technique is to send you an email making you an offer that sounds reasonable on the surface, but requires you to open an attachment with the details of the offer. Again, once you open that attachment, they’ve got you. What happens behind the scenes is that the attachment has a robot program that can do almost anything that they want it to do. It can install a keystroke logger and send your internet banking or credit card passwords to the cybercriminal. It can give control of your computer over to the cybercriminal and so enable more of these schemes to be run from your computer. The possibilities are endless.

Sometimes the Spear Phisher makes the email look like its coming from your boss – again remember he has email addresses and names. The email may require you to give up password and other authentication information in order to perform a “security audit” or an “account verification”.

Key to making this criminal endeavor work is that it requires your participation to either provide the missing information or open the attachment. So the best defense it to verify the email by contacting the sender by phone or alternate method if the email looks suspicious. A good antivirus program installed on your computer can help too.Remember for the scheme to work it requires your participation.

We might as well brace for a number of these email attacks. Recently Epsilon, a division of Alliance Data suffered an illegal entry on its client’s email databases. This is the company that processes marketing communications for loyalty programs like Marriott Rewards, Citibank Advantage and many other large organizations. Imagine the rich information for cybercriminals that email addresses, names and loyalty program associations can provide. If you belong to the Marriott Rewards program like I do, expect an incredibly valuable offer to come to you via email. Do not open the attachment even though the logo looks almost right and the text has only one or two spelling mistakes.

There’s lots of regulations coming from Washington DC these days, but I don’t think they can think one up for this.


CHS Software you may want to use

Often, we at CHS, are guilty of not informing you of products or features that we have implemented over the past year that you may want to use. This year we have rounded out our individual enrollment, billing and administration offering with a full cycle product. If you sell individual policies or sell voluntary products in addition to your regular employer sponsored group health offerings, this may interest you.

"Full Cycle" in this context means the following:
i) taking the application for enrollment of the individual/family on the web, after getting their responses to qualifying/underwriting questions,
ii) enrolling them in the plan of choice,,
iii) billing their credit card or bank account at the appropriate frequency, i.e. monthly, quarterly, semi-annually or annually,
iv) applying the payments received against the appropriate invoices
v) disbursing premium/commission and other payments to carriers, brokers/agents and other suppliers
vi) updates to Accounts Receivable, Accounts Payable and General Ledger without manual intervention after set-up.

We would like to say that all of the above happens "automatically" (a grossly over-used word) but it doesn't. It happens with minimal, but appropriate, human intervention. For example, there are checks and balances in place to make sure that premium billing adjustments owing to changes in family composition or product choices are made accurately. The web enrollment product, CHS iCoverNow, has to be customized with your logo, color palette, questions and response logic. Users of our product like it. It has allowed them to grow into areas where they couldn't before. We believe that this will interest administrators of individual health plans who sell to the public at large and may become a valuable tool in the context of health care reform.