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President Trump has issued executive orders aimed at reducing the cost of medications by tying Medicare payment for outpatient drugs to international prices, passing drug-maker rebates to patients and not middlemen, and allowing individuals to import prescription medications.
Another executive order aims to force community health centers that receive 340B drug discounts to pass discounts for insulin and injectable epinephrine on to patients. Here's a run-down of the orders: Drug importation The Executive Order on Increasing Drug Importation to Lower Prices for American Patients calls for new regulations that would:
The system that Trump is proposing is reportedly modeled after new laws that took effect in Vermont in 2018, Florida in 2019 and then Colorado and Maine last year, allowing for the importation of certain prescription drugs from Canada. Florida's bill directed the state's Agency for Health Care Administration to establish a Canadian Prescription Drug Importation Program and an International Prescription Drug Importation Program. Vermont and Florida have already submitted proposals to the U.S. Department of Health and Human Services to import prescription drugs from Canada, as the president in recent weeks has reiterated his intention to allow states to do so. Federal law already grants HHS the authority to allow drug imports, as long as the department's secretary certifies the imported drugs are safe and effective and would lower costs to U.S. consumers. HHS and the Food and Drug Administration in early August unveiled two pathways that entities could use to import drugs. Under one pathway, HHS and the FDA would use existing rulemaking authority to allow states, pharmaceutical manufacturers and pharmacists to develop pilot programs to import drugs from Canada "that are versions of FDA-approved drugs that are manufactured consistent with the FDA approval." Eliminating secret deals Another order would prohibit secret deals between drug makers and pharmacy benefit manager (PBM) middlemen, ensuring patients directly benefit from available discounts at the pharmacy counter. The Executive Order on Lowering Prices for Patients by Eliminating Kickbacks to Middlemen would pass drug-maker rebates to patients and allow them to apply the rebate to their cost-sharing, such as deductibles in Medicare Part D plans. The order states that the any rebate rule could not be advanced unless the HHS secretary gave public confirmation that it would not raise premiums, taxpayer spending or out-of-pocket costs. In particular, the proposed rule would exclude from safe-harbor protections under the anti-kickback statute price reductions that are not applied at the point-of-sale or other remuneration that drug manufacturers provide to health plan sponsors, pharmacies or PBMs in operating the Medicare Part D program. It would also establish new safe harbors that would allow health plan sponsors, pharmacies and PBMs to apply discounts at the patient's point-of-sale in order to lower the patient's out-of-pocket costs. This would be a significant step in getting drug-maker discounts to patients instead of the PBMs. One of the reasons pharmaceutical prices are so high is the complex mix of payers and negotiators that often separates the consumer from the manufacturer in the drug-purchasing process. The result is that the prices patients see at the point of sale do not reflect the prices that their insurance companies, and PBMs hired by those companies, actually pay for medicines. Instead, PBMs negotiate significant discounts off of the list prices, sometimes up to 50% of the cost of the drug, and often the Medicare patient can never enjoy that discount. International reference pricing Another executive order, which hasn't yet been published publicly, would establish an international pricing index that would set the price Medicare Part B pays for the costliest medications covered under the program to the lowest price in other economically advanced countries. However, Trump said his administration will hold the order until Aug. 24 because he may not implement it. He said he needs to meet with pharmaceutical executives first. Epinephrine and insulin discounts The Executive Order on Access to Affordable Life-saving Medications would require federally qualified health centers to pass along discounts on insulin and injectable epinephrine received from drug companies to certain low-income Americans. Only patients with low incomes; those with high cost-sharing requirements for insulin or epinephrine; those with high, unmet deductibles; and/or those without health insurance would be eligible for the discount. What's next In all, Trump issued four executive orders that will require the Centers for Medicaid and Medicare Services to draft new regulations, which would likely not be completed by the end of the year. Regulations often take months to draft and then have to be sent out for public comment before final regs are written. The regulations will likely only come to fruition if Trump wins the presidency for a second term, as any regulatory initiatives in mid-stream would probably otherwise be abandoned.
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For 2017, private flood insurance statements had to be reported. This was the first time that such information was required to be reported. The Insurance Information Institute released a list of the market's biggest insurance companies offering the coverage based on previously gathered data and they said that over 80 percent of the market share was held by these leading companies. The top company alone held nearly 55 percent. Total premiums written by all companies totaled over $375 million. What is Private Flood Insurance? This type of coverage is available for both residential and commercial properties. The policies cover excess flood and flood peril, and they do not include damages from sewer backups or crop flooding. In the past, only the government offered flood insurance. However, private insurers are becoming more comfortable offering this coverage today because of the following reasons:
Why Private Insurance is a Good Solution After several catastrophic hurricanes over the past decade, the National Flood Insurance Program offered by the Federal Emergency Management Agency took a major financial hit. It is currently billions of dollars in debt. This has also helped open the market for private insurance companies to offer flood protection. Lawmakers like the solution since it will help get the NFIP out of debt faster. In early 2017, the NFIP transferred financial risks totaling $1 billion to private insurers. This was done through reinsurance, which FEMA gained approval for, thanks to the Homeowner Flood Insurance Affordability Act of 2014 and the Biggert-Waters Flood Insurance Reform Act of 2012. More options and competitive pricing are two benefits that an improved private flood insurance market would create. A Peek At Potential Savings KatRisk and Milliman partnered to collect and analyze data from three states that have been affected by catastrophic hurricanes and face higher risks of future damages. The organizations looked at data from Louisiana, Texas and Florida. These three states represent over 55 percent of the NFIP's active policies in the USA. The researchers compared NFIP premiums to several private insurance premium models. Research showed that more than 75 percent of Florida homeowners would see lower premiums with private insurers. More than 90 percent of Texas homeowners would save money, and nearly 70 percent of Louisiana homeowners would see a premium drop. About 70 percent of the Texas homes included in the model would qualify for a premium that is one-fifth of the NFIP's equivalent policy. The ratio dropped to about 45 percent in Florida and a little over 40 percent in Louisiana. However, researchers also found that about five percent of the modeled homes in Texas would see premiums that were higher than the NFIP's, and the ratio increased to about 15 percent in Florida and over 20 percent in Louisiana. As researchers continue to track state-specific data in the coming years, more property owners will be making the switch to save money. To learn more about private flood insurance and if it is a good solution for individual needs, contact us. Almost everyone has a risk of their home being flooded, regardless of where they live. And now as flooding has become an annual threat to many communities across the country, even areas that were not considered flood-prone are also at risk. There was record rain and snow in many parts of the country in the early part of the year, and many areas can therefore expect flooding. According to the Federal Emergency Management Agency, more than 20% of all flood insurance claims come from areas outside of high-risk flood zones - and that number is rising with each passing year. That still means the vast majority come from high-risk areas. How can a property owner find out what their flood risk is? Gauging your flood risk FEMA considers a property to be at high risk of flood if there is at least a one-in-four chance of flooding during the life of a 30-year mortgage. Geographic areas with this risk are known as special flood hazard areas (SFHAs). Federal regulations require federally regulated or insured mortgage lenders to confirm that mortgaged properties in these areas carry flood insurance. The traditional way to determine a property's flood risk is to locate it on a flood insurance rate map (FIRM). FEMA publishes these maps based on geographic survey data. They are the official depictions of flood hazards in a locality. FIRMs are freely available for review at the Flood Map Service Center on FEMA's web site. As a property owner, you can view your flood risk by entering your address in the search field. Flood maps assign each area in a community to labeled flood zones. Areas with low-to-moderate risks of flooding are assigned to zones with labels beginning with the letters B, C, X or a shaded X. SFHAs are designated with the letters A or V. These areas are shaded on the maps for easy identification. Property owners can also search for their flood risks at FEMA's flood insurance consumer web site, www.floodsmart.gov. By entering your address in the fields on the home page, you can quickly learn whether you face a low-to-moderate or high risk. The site offers other valuable tools, such as an estimator that can calculate how much financial damage a given amount of water (two inches, four inches, etc.) would cause in homes of various sizes. For example, six inches of water in a 2,000 square foot home would cause $39,150 in damage. FEMA also offers a suite of flood risk products that go beyond the information provided in a FIRM. They include:
These products are helpful for community planners, but individual property owners can also use them to get a clear idea of their flood risks. Elevation certificates may also be on file with local governments for certain properties. These documents show the elevation of the lowest floor of a building (including the basement) compared to the base flood elevation for the area. An elevation certificate demonstrates community compliance with flood-plain management laws and is used to set appropriate flood insurance premiums. The takeaway A flood can be every bit as catastrophic as a fire. It is worthwhile for property owners to learn their flood risk and take steps to reduce it. Additionally, with the increasing risk of flooding in non-flood-plain areas, if you live near a flood plain, you may want to secure flood insurance. One of the biggest mistakes you can make if you incur damage to your business premises is to wait too long before filing the claim with your insurer. The owners of a hotel in Dallas learned this the hard way when a U.S. Circuit Court of Appeals held that the business had waited too long to file a claim with its insurer after suffering hail damage. The court ruled that because the hotel had waited more than 19 months to file the claim, it was impossible for the insurer to ascertain exactly when the damage had occurred. The hotel's property policy required that the insured make "prompt notice" of any claims. But the insurer rejected the claim when it received it for a hailstorm that had happened more than a year and a half earlier, on the grounds that it could not determine what had caused the damage or when the damage occurred. This was crucial since the policy had expired 17 months earlier - two months after the storm had allegedly damaged the hotel. Believe it or not, filing late is a common problem and it is one of many mistakes business owners make when filing claims. The following are surefire ways to risk having your claim denied or disputed by your insurance company: Not contacting your insurer immediately While most insurance policies state that you must notify the company promptly of a loss, what counts as "prompt" may be a little vague. However, you can wreck your claim by reporting a loss so late that it "prejudices" the insurance company. For the most part, you should take steps to notify your insurer as soon as possible after you become aware of a loss. Failing to document the damage Take pictures and itemize everything that was damaged. Often, you will have to make repairs immediately to prevent additional damage, or move machinery to a new location. If so, be sure to photograph the original scene to document how it was before you started your clean-up effort. Also take photos of any repairs you make. Disposing of damaged goods If your business clean-up includes removal of items such as water-damaged merchandise, flooring or insulation, keep it all, even if it has to pile up in the parking lot. The damaged materials are all evidence of the impact of the disaster on your business. Not appealing an insurer's low estimate After the claims adjuster inspects the damage, the insurance company will give you a damage estimate. If you think it's too low, you can appeal. We can help if you feel the estimate is too low. But some businesses will hire an outside adjuster to make a second estimate, and then the claim will go to mediation for a final resolution. Not reading your policy You should understand exactly what your policy covers. For the most part, commercial property policies will not cover flooding or earthquake damage. That kind of coverage will often require a separate policy or rider. Not being prepared If your business suffers damage, you'll be better off if you know what to do in advance. Some advance steps you can take are:
A final word… Filing a claim is usually not a difficult process, but you should be prepared in advance, like making sure you keep good records of all your assets, including receipts, payment schedules and more. Finally, if you are unsure whether you should file a claim on any of your commercial policies, you can always give us a call to discuss the event and we can assist you. If you have life insurance and are concerned if it will pay out in case you pass from COVID-19, you can rest assured your loved ones will receive a payout, but if you have not yet purchased coverage, it's not too late. The good news: Life insurance is still very much available and, according to trade publication reports, there was a noticeable increase in policy applications in March. You will have to move quickly though, as some experts think life insurance companies may impose stricter underwriting standards as they see higher losses in addition to losses in their investment portfolios, which they use to fund claims payouts. While life insurers are not excluding claims related to a pandemic, they may start including exclusionary riders on new policies as well as increasing premiums. And if the pandemic worsens, some insurers may opt to put a hold on writing new policies, particularly for older individuals, and resuming once a vaccine has been developed. As for pricing, insurers have not yet been raising rates in response to the coronavirus, but they may later, particularly for permanent - or whole life - policies. That said, pricing for term life policies is not expected to see any changes. New policies Many life insurers that are writing new policies now are asking applicants if they've been tested or treated for the virus. After the underwriting is complete, they are asking them again to sign a statement saying their health status has remained unchanged. If someone buys a life insurance policy today and finds out later they have COVID-19, and then dies from it, their beneficiaries will receive a payout as long as the policyholder didn't lie about their health status (like knowing they had COVID-19 when buying the policy). Also, people who contracted COVID-19, were hospitalized and later discharged after recovering may have difficulties in purchasing a life insurance policy now. That's because most insurers will ask on their applications if you have been hospitalized in the past year. Another new question that insurers are asking new life policy applicants is whether they have traveled overseas recently or been on a cruise. While the possibility that you did this recently are now quite slim, if you did, some insurers are asking that you wait 30 days since you returned before applying for coverage. Medical exams You will often be asked to undergo a medical exam when applying for life insurance. If the life coverage you're applying for requires a physical, chances are that it will still go on as planned, unless you're uncomfortable with it or are sick. Some people may be nervous about going in for an exam, particularly if they are under orders by authorities to stay home. With that in mind, many insurers are offering an extension of up to 90 days on the medical exam. In the meantime, they will offer immediate coverage to those applicants up to $1 million. One workaround for this is to first secure a no-exam life insurance policy, which does not require a physical to qualify for coverage. You can apply online and typically get approved the same or next day. This way, you can at least get some coverage in place if you have not been diagnosed with COVID-19. One thing about no-exam policies is that they will typically have lower limits than standard policies. They may also cost more than life insurance that requires a medical exam. COVID-19 is forcing businesses to face a number of risks, liability and insurance implications. Companies could seek coverage for a variety of claims stemming from the outbreak, including workers' compensation, business interruption, liability and more. And, now that it is a pandemic, the economic fallout may be expansive - hitting your company's operations in the form of lower sales or supply chain disruptions. Now is a good time to understand which of your insurance policies could come into play. Workers' compensation Workers' compensation policies generally extend insurance benefits to employees for injuries and illnesses "arising out of or in the course of employment." That wording makes it difficult for most workers to file a claim if they suspect that they got the coronavirus at work, presumably from another employee, customer or visitor to the workplace. But if an employer knows that the virus is in the workplace, coverage could apply. Workers' compensation could come into play in the following instances:
However, workers' comp insurance would likely not cover employees who are working on assignment abroad for more than a short time. Business interruption One major fallout from the spread of COVID-19 is that it has cut into global supply chains, forcing manufacturers around the world to suspend production. This has been especially true for companies that rely on China for their parts and materials. But now that the virus has exploded in a number of countries, the threat to supply chains will only increase. This has already started affecting companies in the United States. If your company's operations are affected or stopped due to the virus, you may be wondering if the business interruption coverage in your property policy or business owner policy may pay out. Business interruption coverage replaces income that was lost due to a disaster, such as a fire on the premises of the company or one of its suppliers, or a hurricane that hinders a company from operating. However, any hit to your income from coronavirus would not be physical damage, which is a prerequisite for this coverage. Viruses and disease are typically not an insured peril unless added by endorsement. In many cases, the policy may specifically exclude coverage for viruses and disease. There is potential coverage through communicable disease coverage under proprietary insurance carrier forms if the insured is closed by a "public health authority" order for closure, decontamination, etc. But it's worth noting that these usually require the order to happen, so the insured cannot voluntarily decide to close and then claim coverage. General liability In terms of liability, a third party - customer, vendor or guest - could claim they were sickened on your property and sue your business for negligence for failing to provide a clean facility, which could trigger your commercial general liability policy. Any company that deals with the public or customers, like a retailer, restaurant, hotel, daycare center or a gym, would be at greatest risk for this type of action. While the chances of them winning such a case would be small, you could still face legal bills, which your CGL policy would typically cover. If there is coverage, it would come under the policy's "bodily injury" portion. Some CGL policies exclude claims arising from a pandemic, virus or bacteria, so read your policy carefully. Many insurers also include broadly worded pollution exclusions that could preclude or limit coverage. Business travel accident insurance This insurance could cover employees who travel on business domestically or internationally, foreign employees of U.S.-based businesses and U.S. employees on offshore assignments. The insurance provides:
If you are like most people, it's always in the back of your mind when you decline the car insurance when renting a vehicle while away on vacation or business. If you've ever opted for full supplemental coverage, you've likely noticed that the cost of your rental skyrockets by more than 50% in many cases. But, if you already have insurance for your personal vehicle, you likely don't need it. There are two reasons you may want to forgo agreeing to purchase insurance at the rental counter: 1. Your existing insurance The insurance policy for your personal car or truck will usually cover you for a variety of risks:
2. Your credit card Some credit cards, particularly gold or platinum ones include rental car insurance. This applies only if you use the same card to pay for your rental car. Terms and conditions vary, but generally:
Read up on this in the terms and conditions of your credit card so that you understand exactly what the card covers in terms of rental car insurance. For example, you may not be able to rent certain types of vehicles, or it may not cover certain damage, like from driving on a dirt road. Card issuers frequently cap rental periods as well. Make sure you know what your credit card company offers before you rent a vehicle. But wait… there's more If your personal insurance policy doesn't include comprehensive or collision coverage, you may want to purchase liability coverage from the rental company. It may also be wise to do so if you already have a high deductible on your personal auto's insurance policy. Also, if you're renting a car on a business trip, or intend to drive it into another country (other than Canada), you will likely need additional coverage. If you have any questions, call us. One of the modern plagues is the emergence of "porch pirates" - the thieves that cruise neighborhoods looking for packages that have been left on people's doorsteps by UPS, FedEx and other delivery services.
Thefts of packages from front porches have become a nationwide epidemic, with 26 million Americans having a holiday package stolen from a front porch or doorstep in 2018. One of the difficulties in thwarting porch pirates is that it is most often a crime of convenience. Typically, someone sees a package sitting on a doorstep and there are no cars in the driveway, so they walk up and grab it. Solutions As the problem has grown rapidly, fortunately there are new services and products on the market that can help reduce the chances of having one of your packages stolen after it's been delivered. BoxLock - This service provides homeowners with a smart padlock designed to protect deliveries by scanning packages so that delivery drivers can unlock a storage box on the customer's porch. Only packages addressed to the customer - and that are actually out for delivery that day - will unlock the BoxLock. Once unlocked, the delivery person securely places the package in the box. Landport - This is a secured delivery drop box homeowners can install on their porch or stoop. The box, which is bolted down, has an electronic keypad on which a delivery driver enters a unique access code to open the lid. They place the package in the box and shut it, and it locks by itself. Amazon Key - The service by online retailer Amazon works like this: When a delivery arrives at your house and you're not home, the courier scans a barcode that sends a request to Amazon's cloud. If it's approved, Amazon remotely unlocks your door and starts recording video through its Cloud Cam. The delivery is left inside the house. Once the courier relocks the door, the customer receives a notification that the delivery was just made (accompanied by a short video showing the successful drop-off). Amazon Locker - Use the online zip code locator to find a locker near you, and use that as your delivery address. It's free to use - and if you're a Prime member, you're entitled to free two-day shipping. Package Guard -This frisbee-like device is a virtual security guard. Connect it to your Wi-Fi and position it on your doorstep, instructing delivery people to place packages on top of it. If a porch pirate attempts to steal the package or the Package Guard device itself, a loud internal siren will be activated. The only way to deactivate the alarm is via the Package Guard app. Other things you can do
As a new decade begins, the health insurance industry is on the cusp of making a leap towards improved, higher-tech management of health plan participants.
A recent paper by Capgemini, an insurance technology and consulting firm, predicts the following trends that will be taking shape in the health insurance industry and how they may affect businesses that are paying for their employees' coverage. 1. Realigned relationships - Insurers are trying to shift risk between themselves and pharmaceutical companies in an effort to reduce drug outlays. The report says insurers are also working more closely with health care providers for early intervention in medical issues that may be facing participants. Addressing health issues early can reduce long-run treatment costs. 2. Fluid regulations - As we've seen, just because the Affordable Care Act became the law of the land, the regulations governing health care and health insurance have continued streaming out of Washington. If the last two years are any guide, this will continue to be the case. Also, the constitutionality of the ACA is now being litigated once again after an appeals court upheld a lower court's ruling that the individual mandate is unconstitutional. 3. Increasing transparency - More stringent regulations, along with President Trump's recent executive order to improve price and quality transparency, are forcing the health care industry and insurers to become more transparent in their pricing. One of the biggest focuses is on the drug industry and the role of pharmacy benefit managers, the largest of which have been criticized for being opaque in their pricing, discounts and how they handle drug company rebates. Also, insurers are increasingly providing detailed information regarding services covered under their health plans, claims processing and payments. Additionally, some insurers are helping enrollees to make more informed decisions before they use a health care service by providing digital tools to help them reduce out-of-pocket expenses. 4. Predictive analytics - Health insurers are using predictive analytics for risk profiling and early intervention for enrollees with health issues. Predictive analytics provide insurers with insightful assessments of potentially high-risk customers, in order to mitigate losses. With advancements in technologies such as big data and connected devices, insurers now have access to vast amounts of customer data, which can be used to remind people it's time for their check-ups, medications and other necessary medical services. Insurers are using predictive analytics to identify and monitor high-risk individuals to intervene early and prevent further complications. This in turn can help reduce claims. One of the keys to managing risks when you first start a business is getting the right insurance to cover your operations, property and potential liabilities.
Unfortunately, many business owners fail to update their policies and just renew them year after year even if the company has grown, expanded operations and facilities, and added new equipment and property. If this is the case, the old coverage would be insufficient. Business owners should review their policies every year to catch any omissions and make sure they are not underinsured. It is common for smaller businesses to secure a basic business owner's policy (BOP) and workers' comp when they first get started. A BOP includes:
Outgrowing BOP coverage As your business expands, you may outgrow the BOP and need additional coverage to manage your risks. Some examples include the following:
Depending on the business, some or most of these insurance options may be required for adequate protection. Annual reviews with us are ideal for discussing your options. Make sure these elements are considered:
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