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Risk Manager Newsletter October/Fall 2008
October/Fall 2008 Health Insurance and the Upcoming Elections As we head into the election season, health insurance and health care will be hot topics. Granted, they’ll take a back seat to the economy, but health care financing issues have been on the back burner far too long and are bound to get some attention. In a nutshell, the plan set forth by Sen. John McCain is market driven. He wants to give people tax credits which would be paid directly to an insurance company to purchase a policy. McCain figures that the more people that are driven to buy insurance, the lower the premiums will become. Sen. Barack Obama’s plan has the government participating to a greater extent, requiring health insurance for all children, subsidies for families who can’t afford health insurance and a national insurance plan based upon the federal employees plan that would be accessible to private employers. You can see that the two plans fall directly along party lines. Market driven reform offered by the Republicans and national health care offered by the Democrats. We believe that what is more likely to happen is that the responsibility will fall on each state to resolve their market’s problems. Recently, at the annual meeting of the Wisconsin Association of Health Underwriters, it was announced that Gov. Jim Doyle wants an expansion of BadgerCare and BadgerCare Plus for small employers, from two to one hundred in size. The plan, called Badger Connect is roughly based upon the plan that has failed miserably in Massachusetts. In this plan, small employers would have access to the same plan as State employees. The concern here is that the first employers to apply would be those with the worst health histories. The plan would go broke before it begins. We have a lot to watch for after the upcoming elections. Stay in touch with your legislators, give them your opinions, and, by all means, keep big government out of the health insurance business. In all sincerity, Thomas A. Witkowski back to top Funeral Directors; Does your Business Owner¡¦s Insurance policy need to be revived? by: By Nicole Cutraro The proper insurance coverage for your business is essential. Professional Insurance Programs, Inc. offers a Business Owner¡¦s insurance policy with the option to include your Professional Liability coverage under one policy, written through C.N.A. Insurance Company. The C.N.A. policy offers broad coverage along with a wide range of limits, deductibles and optional enhancements. Broad Automatic Coverage „Ï Equipment Breakdown - Most businesses own equipment that is dependent on electricity. Typical property coverage may not cover loss or damage as a result of electrical spikes, surges or arcing. „Ï Business Income and Extra Expense from Dependent Properties ¡V Many businesses rely on other businesses, either as a supplier or as a customer. This reliance is so prevalent in small business that it creates exposures not contemplated by many policies. „Ï Expanded Limits for Theft of Money and Securities ¡V Many products on the market still offer the same small limit for money and securities they offered 15 years ago. C.N.A. offers automatic coverage up to the Business Personal Property limits selected on the policy. „Ï Pollutant Clean Up & Removal coverage with an annual $25,000 limit. Optional Coverage Enhancements „Ï Funeral Directors Professional Liability Coverage „Ï Enhanced Replacement Cost ¡V The cost of building materials can increase dramatically. This option offers an additional 25% above the stated replacement cost limit in the event of a building loss. „Ï Hired Auto & Non-Owned Auto Liability For additional information on Professional Insurance Programs Business Owner¡¦s and Professional Liability coverage¡¦s please contact the P&C Team at 800-637-4676. back to top Amplify Your Client Relations Program! by: Excerpts from Care and Feeding of Clients in a Down Economy, Sara Kraeski, Law Practice, September 2008 Times like these call for amplifying your client relations program. Here’s how to start: 1. SEGMENT. Rank your clients by how much profitable business they could deliver in the future. Pick the top 10 percent, and target htem for your client relations program. 2. RESEARCH. Regularly pull information about your clients’ business plans, executives, competitors, recent events and industry and political trends. 3. FEEDBACK. Gauge their satisfaction through regular client interviews and find out how you could provide better value to their respective businesses. 4. CUSTOMIZE. Based on the results of your research and interviews, create a service plan for each client. Be creative, and tailor your plan to clients’ unmet and emerging needs. 5. Cross-Sell. Clients tend to stick to firms that have four or more practice groups servicing them. Be able to articulate a positively differentiated benefit to clients if you want to cross-sell a particular service to them. back to top Health Insurance Probationary Period by: By: Christine K. Bachmann At time of enrollment the Employer selects the group’s probationary period. This is the length of time a Full-Time employee must work before they are eligible for the group health insurance coverage. As an employer your responsibilities include the following: • Giving notice of eligibility to each employee who is or will become eligible for enrollment under the Group Health Plan • Obtaining and submitting complete enrollment information for eligible employees wishing to enroll. If you have any questions on the probationary period you initially selected or wish to change this, please contact your WDAIP Account Representative at 800-242-9077 or 414-277-7727. back to top Health Reimbursement Arrangements (HRAs) Have Hit Their Stride As A Viable And Valuable Employee Benefit Option An HRA, in general, is a benefit plan that allows an employer to create a pool of funds which participating employees draw upon as reimbursement for eligible medical expenses that are not covered by the underlying insurance plan. From deductible and coinsurance expenses to co-payments, employers can chose the expenses that they’d like to be eligible for reimbursement under their HRA. After a participant incurs an eligible expense, they request a reimbursement from their potion of the employer-funded account. Employers can offer an HRA alongside a flexible spending account (FSA) and employees can participate in both. However, if the HRA and FSA have an overlap in the types of eligible expenses, the same expense can only be reimbursed by one of the two accounts. For more information, contact your PIP representative today at 414-277-0154 or 800-637-4676. back to top New Annual Contribution Levels for Health Savings Account by: Presented by Kim Waisanen The IRS recently announced the contribution limits for Health Savings Accounts for 2009. Those limits will be $3,000 for those with self-only coverage and $5,950 for those with family coverage. These limits apply regardless of the health plan’s deductible, though the plan must be H.S.A-qualified. Catch up contributions for individuals who are 55 or older is increased by statute to $1,000 for 2009 and all years going forward. back to top IRA-TO-HSA rollovers The Internal Revenue Service recently issued guidance on subsidizing HSAs with money from individual retirement accounts. In Notice 2008-51, which implements provisions under the Health Opportunity Patient Empowerment Act of 2006, the IRS outlines 10 scenarios on how the rules would apply. Individuals covered by a high-deductible health plan that also own a traditional or Roth IRA can make a one-time IRA-to-HSA funding transfer without facing federal income taxes or penalties. The transfer amount, however, cannot exceed the individual’s maximum HSA contribution limit. Also, money will have to go directly from the IRA trustee to the HSA trustee. Please seek your Accountant’s advice before taking action! back to top Is Your Firm Properly Insured? Today, businesses face greater risks than ever before. In addition to such typical risks as theft and fire, there are a host of other risks that are unique to each particular type of business. That’s why it is essential that business owners make sure they buy the right type and amount of insurance and update their policies annually to include improvements, major purchases and increased rebuilding costs, as well as ay liability risks, according to the e Insurance Information Institute. A Business owner’s Policy (BOP) is recommended for most small businesses (usually 100 employees or less), as it is often the most affordable way to obtain broad coverage. Combining both property and liability insurance, a BOP will cover your business in the event of property damage, suspended operations, lawsuits resulting from bodily injury or property damage to others, etc. BOPSs do NOT cover professional liability, auto insurance, worker’ compensation or health and disability insurance. You’ll need separate insurance policies to cover professional services, vehicles and your employees. For medium and larger businesses, there are more comprehensive commercial policies. To properly insure your business, ask your agent these four important questions: 1) Do I have enough insurance to rebuild my business property and replace all of my merchandise and possessions? 2) Do I have enough insurance to protect my employees’ personal property 3) Do I have enough insurance to keep my business open? 4) Do I have enough insurance to protect my assets from a lawsuit due to bodily injury, property damage, personal injury (including slander or libel) and advertising injury? Have your PIP representative review your current Business Owners Policy today! Call 414-277-0154 or 800-637-4676 back to top The Question Is: Not If But When Will Alzheimer’s Affect You by: Submitted By: M. Roberts, VP Professional Insurance Programs, Inc. The number of Americans surviving into their 80s and 90s is expected to grow because of advances in medicine, medical technology and social and environmental conditions. Since the incidence and prevalence of Alzheimer’s disease and dementia increase with age, the number of people with these conditions will also grow rapidly. In Wisconsin, there is a projected 10% increase in the number of people age 65+ with Alzheimer’s disease between 2000 and 2010. • In 2000, there were an estimated 411,000 new cases of Alzheimer’s disease nationwide. That number is expected to increase to 454,000 new cases a year by 2010, 615,000 new cases a year by 2030, and 959,000 new cases a year by 2050. • The number of people age 65 and over with Alzheimer’s disease is estimated to reach 7.7 million in 2030, a greater than 50 percent increase from the 5 million age 65 and over who are currently affected. • By 2050, the number of individuals age 65 and over with Alzheimer’s could range from 11 million to 16 million unless science finds a way to prevent or effectively treat the disease. By that date, more than 60 percent of people with Alzheimer’s disease will be age 85 or older. Who Are the Caregivers? Family and other unpaid caregivers of people with Alzheimer’s and other dementias are more likely to be women than men. About 60 percent of unpaid caregivers are wives, daughters, daughters-in-law, granddaughters and other female relatives, friends and neighbors. The remaining 40 percent are husbands, sons, sons-in-law, grandsons and other male relatives, friends and neighbors. Caregivers range in age from very young to very Old: among caregivers age 18 and older, 19 percent were under age 35; 29 percent were ages 35-49; 37 percent were ages 50-64; 14 percent were age 65 and over.22 Their average age was 48. Costs to Individuals and Their Families Although Medicaid covers some long-term care costs, families coping with dementia often incur considerable costs in caring for a person with Alzheimer’s disease or another dementia. Costs are high for care at home or in an adult day center, assisted living residence or nursing home. • The average hourly rate for home health aides in 2007 was $19 or $152 for an eight-hour day. For homemaker or companion services, costs ran $18 an hour. • Adult day center services cost an average of $61 per day in 2007. • The average monthly cost for a private, one bedroom unit in an assisted living residence was $2,969 or $35,628 a year in 2007. Assisted living residences that provide specialized dementia care often charge additional monthly fees averaging $1,110 for that care. • The average daily cost for a private room in a nursing home was $213 in 2007 or $77,745 a year. • Medicare beneficiaries age 65 and older paid 37 percent of the cost of their nursing home care out of pocket in 2002. • U.S. National Health Expenditure Accounts show that consumers’ out-of-pocket payments funded 26 percent of all spending on nursing homes in 2006. For additional information, the 2008 Alzheimer’s Disease Facts and Figures is a comprehensive statistical abstract of United States data on Alzheimer’s disease, the most common type of dementia and is available via the Alzheimer’s Associaiton at www.alz.org. For information on long term care insurance, please contact our Long Term Care Specialist-Melissa Coppage-at 262-784-8400 ext 143. back to top Maintenance Is Vital to Helping Protect your Career Most-if not all-Real Estate professionals are aware that they must regularly participate in continuing education courses to remain licensed. But did you know that there are additional reviews that you can perform periodically to help reduce your risk of a claim? *Report all claims or potential claims to your errors and omissions carrier in writing prior to renewing your coverage with the same or a new carrier. Should you fail to report even a potential claim, you could jeopardize your prior acts coverage-opening your firm and yourself up to thousands of dollars in litigation costs. When in doubt if an event qualifies as a claim, play it safe and contact your carrier for assistance. *Keep current on all applicable laws and regulations to avoid pitfalls that could lead to license sanctions or possible revocation. The real estate industry is governed by many different federal, state and local departments, resulting in numerous changes in the rules applicable to you and your firm each year. You should become familiar with those policies that pertain to you and review them regularly to remain up to date on any modifications. *Review the Code of Ethics regularly. As a REALTOR®, you have agreed to act under and adhere to strict Code of Ethics. To find the most current Code of Ethics and Standards of Practice, visit the National Association of REALTORS® website at www.realtor.org. Attend risk management seminars for updates on legal trends and tips on how to reduce your legal liability. Most often this will provide you a discount toward your E&O Insurance. By practicing sound risk management techniques and keeping current on Real Estate regulations, you can help safeguard your career. back to top Save Money On Dental Care, Vision Care, Hearing Care, Chiropractic Care, and Prescription Drugs! Professional Insurance Programs, Inc. (PIP) is proud to announce a new discount program that makes it easier to afford important life enhancing services through Benessential. Now you can choose up to four of the Benessential programs in any combination you wish with no waiting periods, no claims to fill, no annual maximums and no deductibles! Monthly Rates: Any one plan: $8.50 per head of household Any two plans: $9.00 per head of household Any three plans: $9.50 per head of household Any four plans: $10.00 per head of household For more information about this exclusive discount card program, call 866-539-1068. You can also download enrollment forms directly from the PIP website at www.insuranceformembers.com in the DOCUMENTS section. Start saving money today! back to top Past Issues April/Spring 2008 January/Winter 2008 October/Fall 2007 July/Summer 2007 April/Spring 2007 Oct/Fall 2006 July/Summer 2006 April/Spring 2006 Jan/Winter 2006 Oct/Fall2005 July 05 RM April05RM 4th Quarter 2004 3rd Quarter 2004 2nd Quarter 2004 1st Quarter 2004 2nd Quarter 2003 1st Quarter 2003 4th Quarter 3rd Quarter 2002 Oct/Fall 2005 1st Quarter 2002 2nd Quarter 2002 3rd Quarter 2003 4th Quarter 2003 |
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