Law Change Helps Funeral Directors Sell Insurance

More funeral directors in Nebraska will find it easier to sell funeral insurance, thanks to a change in a state law to take effect on August 30.

The law change lowers the amount of continuing education and training requirements for funeral directors and others to maintain insurance-selling licenses. Before this revision, funeral directors could sell insurance only when they are fully licensed insurance agents and are taking 21 hours of education every two years. Now, they can have a limited line insurance permit if they take three hours of continuing education per two years.

Nebraska Funeral Directors Association legislative chairman William Lauber projected a 20 to 25 percent increase in the number of directors offering insurance because of this law change. Others in the industry pointed out that funeral directors don’t really need full-fledged insurance agent training because it’s a niche market.

A funeral life insurance policy pays for “pre-need” funerals, making it advantageous over giving cash to a funeral home or putting money in certificate deposits, which are payable upon death. This policy can also include portability in case the funeral is in a different location, and increases in value so it can keep up with inflation.

Currently, about 15 other states have similar rules allowing funeral directors to sell “limited line” insurance.

High Costs, Low Enrolment Plague State Health Insurance Markets

State-run health insurance markets are grappling with high costs and disappointing enrolment, leading them to either turn to the federal government or collaborate with other states.

State markets have benefited from federal taxpayers’ money, which provided almost $5 billion in startup grants so these markets could become self-sustaining. However, most of this money has been spent.

Currently, twelve states plus the District of Columbia fully control their health insurance markets. According to experts, about half of them face financial difficulties.

The most recent scenario was the one in Hawaii, where the state marketplace was unable to sustain itself. It has already spent about $139 million of the $205 million grant it was awarded, but has only 8,200 customers for individual coverage this year. Now, the state’s insurance market is turning over its 2016 operations to the federal HealthCare.gov.

Similar situations occur across the nation. For example, in Minnesota, MNsure enrolment has not met projections, and the budget has had to suffer repeated cuts to stay afloat. In Vermont, policymakers are debating whether to abandon its state exchange, troubled by technology problems and the possibility of high taxes. In Maryland, federal audit points to the misallocation of exchange establishment grant money, which the state allegedly used to pay for costs.

Hawaii is actually the third state so far whose exchange is turning over to the federal sign-up system. It follows Nevada and Oregon, which both turned over their markets last year.

Experts say that the downside and pressure is gone for states turning to Washington. This is because the Supreme Court has ruled that the Obama administration, through HealthCare.gov, can continue to subsidize premiums in all states.

Another option for struggling state insurance markets is to join forces with others. There has been talk of “shared services” – states could pool their resources for functions such as labor-intensive call centers. This way, they could still control their own insurance plans oversight, marketing, and consumer education.

The insurance industry, meanwhile, has expressed that it would welcome consolidation.

How The 2010 Healthcare Law Fueled Insurance Merger Mania

Just within 2015, Anthem Inc. purchased Cigna Corp., Aetna Inc. acquired Humana Inc., and UnitedHealth purchased the prescription drug benefits manager Catamaran.

These are only some of the mergers and acquisitions that have proliferated in the healthcare industry over the last few years, largely stimulated by the healthcare overhaul law.

According to a Washington Times report, millions of people have been getting their health insurance coverage since 2010. That was the year when the healthcare law, officially the Patient Protection and Affordable Care Act, was enacted. The law expanded healthcare coverage to more people in various ways, like Medicaid expansion and state public health insurance exchanges. It also required insurers to spend more premium dollars on coverage.

As the health insurance market expands, health insurers face new pressures to keep their respective costs down. At the same time, they can buy one another or make deals faster. These deals allow them to diversify their business and spread out their costs. Many choose to bulk up their Medicaid and Medicare businesses, because these two programs keep growing. In addition, companies that get bigger generally gain more power to negotiate prices with drug companies and healthcare providers.

Health insurance business mergers and acquisitions in recent years have amounted to over $100 billion. Anthem’s and Aetna’s purchases alone have a combined worth of $80 billion, while UnitedHealth’s is at $12 billion. If all these deals go through, says the Times report, Anthem, Aetna, and UnitedHealth will each generate over $100 billion in annual revenue.

There are also smaller deals, especially those focused on technology. The flood of new patients entering the market has prompted insurers to look for more efficient and money-saving systems. This caused a rise in the demand for technology services in healthcare.

The Washington Times concluded that this changing landscape in healthcare is only part of the impact that the 2010 healthcare law has made in the nation.