5 Reasons to lower your Risk Adjustment Factor

   

       Until recently groups with fewer than fifty employees have been subject to Risk Adjustment Factors or RAF.  The RAF is a sliding scale ranging from .90 to 1.10 and is printed on your annual renewal. This number is multiplied by the the insurance carrier's standard group health plan rate which is published with the state of CA. normally on a quarterly basis.  The difference between a higher or lower RAF is plus or minus 10% over the standard published rate.
      One of the least talked about aspects of healthcare reform is the elimination of RAFs for small groups beginning 01/01/2014.    This has created a huge opportunity for small groups (groups under fifty employees) to cut insurance premiums dramatically for the next twelve months.
      Since insurance carriers are scrambling to grow market share before the exchange rolls out in October many are offering a guaranteed .90 RAF for groups over ten employees no matter what your current RAF is.      Although it may seem painful to change your insurance off anniversary, here are a couple of reasons you might consider doing it:

1. Your .90 RAF is locked in for a year

2. Your healthcare cost could decrease 20% without making significant changes to your plan design.   

3. Aetna, Anthem, Blue Shield, Health Net, & United offer the same network with a few minor exceptions.  This means no change in doctors or disruptions for your employees

4. Sharp offers the same network as above minus San Diego Physicians Network Group, UCSD,  Scripps, however their cost may be an additional 5% - 10% less because of the narrower network.

5. All carriers offer similar benefits meaning your id card may change but your coverage doesn't have to.

 Current RAF promos run until August. If you would like help evaluating your options please reach out to me at AndrewO@discoverybenefitsolutions.com or call 619-704-3503.  I can normally provide quotes within 48 hours.

By: Andrew Oram