First it was Cigna. Then Empire Blue Cross. Now it’s EmblemHealth. Beginning May 1 2013, Emblem will take its first steps in pulling out of the small group health insurance market in New York. Though this must be approved by the NYS Department of Financial Services first (no reason to think it won’t be considering Empire Blue Cross two years ago), the following products will be closed to new business:

-EmblemHealth EPO
-EmblemHealth ConsumerDirect PPO High-Deductible Health Plan
-EmblemHealth PPO
-HIP Select® EPO
-HIP Select® PPO

Existing groups that have any of these plans (for the time being) will be allowed to keep the plans moving forward. However, since health agents & brokers will no longer be paid commissions on these products, groups may find themselves obtaining service for their policies directly with Emblem.

We will provide more details of Emblem’s exiting of this market as they arrive.

Below is the official announcement detailing Emblem’s plan on exiting the small group health insurance market in New York. Bear in mind that this is a broker communication blast:

Product Suite, Underwriting Guidelines and Commission Changes

With the implementation of the Affordable Care Act, the health care industry continues to experience tremendous change. There is certainly a challenging road ahead, but there are also opportunities for a successful future. At EmblemHealth, we look forward to continuing to partner with you as we prepare for the future marketplace.

As we prepare for changes related to health care reform, we are modifying policies related to the New York small group marketplace. Below is a summary of these changes:

Streamlined Product Suite

We are streamlining the product options made available for purchase by your group and sole proprietor clients. These changes will take effect for new business and all renewing groups whose plan selection is submitted with an effective date on or after May 1, 2013.

We are committed to refining our product portfolio to include plan offerings that have a number of attractive features at a range of price points that meet your clients’ budget needs. We will continue to offer InBalance EPO, ConsumerDirect EPO and HealthEssentials EPO to small businesses. EmblemHealth will no longer offer sole proprietor plans for new business. For a complete listing and details of the plans we will continue to offer, see our product portfolio on www.emblemhealth.com.

Groups and sole proprietors who currently have one of the plans that will no longer be sold may remain in their current benefit plans. Our rates for the above-referenced plans will continue to appear on the HealthConnect and EmblemHealth Web sites.

Updated Underwriting Guidelines

We are implementing certain changes to our EmblemHealth Small Group Underwriting Guidelines and HIP Small Group Underwriting Guidelines for EmblemHealth and HIP branded plans. These changes will take effect on or after May 1, 2013. The changes are as follows:

•New business documentation must be supplied 30 days prior to the requested effective date. If documentation is not supplied within 30 days, EmblemHealth will establish an effective date of coverage pending receipt and verification of the data.
•New business will only be sold with a first-of-the-month contract effective date. EmblemHealth will no longer be selling mid-month policies. Renewing groups with dates other than the first of the month will not be affected by this change.
•Two-tier premium rates will no longer be available for new sales or plan changes for all EmblemHealth-licensed business. Existing 2-tier groups and sole proprietors will be switched to a 4-tier rating structure at their first renewal on or after June 1, 2013. All tier changes will automatically be made on the group’s renewal date.

GHI-licensed sole proprietors may continue with their 2-tier rate structure.

Changes to Commissions

The 2013 EmblemHealth Selling Agent Commission Schedule will apply to all EmblemHealth products, including all GHI, HIP, and HIPIC underwritten products. The commission schedule will become effective May 1, 2013 for GHI underwritten products and June 1, 2013 for HIP and HIPIC underwritten products.

•All selling agents for new group and existing group accounts will be compensated with a commission rate based on the product, as listed in the new commission schedule.
•All changes to commission payments will be made at one time, when the new commission schedule takes effect.
•Please review the commission schedule closely as some of the products will now have a zero percent commission.

Based on a comprehensive analysis of our products and broker compensation, we made these adjustments to ensure we could fulfill our commitment to provide our members with quality, affordable health coverage.

We look forward to offering your clients value in this challenging environment. If you have any questions about these changes, please call your EmblemHealth representative.

Note: The changes described in this communication do not apply to the plans offered in Allegany, Cattaraugus, Chautauqua, Erie, Genesee, Niagara, Orleans and Wyoming counties.