Claims preparation coverage….

How a ‘minor’ coverage endorsement can prevent a policyholder from incurring significant costs in developing a claim, presenting the claim to the insurer, gathering information requested by the insurer in response to the claim, and in negotiating the claim.

This frequently requires retention of various consultants, including construction consultants for building damage, accountants for time element coverages, and specialists when the claim involves complex or unique equipment or industry-specific requirements such as clean areas for computer or pharmaceutical manufacturers. Policyholders frequently hire public adjusters to oversee the claim preparation, presentation, and negotiation process, and the public adjusters frequently hire the necessary consultants. In other situations, a sophisticated policyholder will manage the claim process itself and directly retain consultants. The claim process is frequently referred to in the industry as the "adjustment" process, with both policyholder and insurer working toward an "amicable adjustment" of the claim.

Sophisticated policyholders frequently have coverage for claim preparation expenses in their policies, although most insurers specifically exclude public adjuster fees from that coverage. In a complicated claim, this additional coverage can be worth tens of thousands of dollars. One typical provision reads as follows.

This section covers the reasonable expenses incurred by the Assured for professional services such as auditors, accountants, architects, and engineers, except the Assured's own employees or public adjusters, which are required to present the loss which is covered by this Section.

As is typical in most policy provisions which provide for the insurer to pay claim preparation expense, public adjuster fees are specifically excluded.

Superstorm Sandy underlines need for Hospitals to have better Disaster Recovery Plans!

The equipment failures at NYU and nearby Bellevue Hospital, the nation’s oldest and one of its busiest, brought to the fore what emergency experts have warned for years. Despite bitter lessons from the recent past, U.S. hospitals are far from ready to protect patients when disaster strikes their facilities.

For most hospitals, “emergency preparedness” means being ready to treat a surge of patients from an earthquake or terror attack – disasters outside their walls. Even the federal program that coordinates hospitals’ preparedness at the Department of Health and Human Services has this mindset: it focuses on planning for mass fatalities and quickly reporting their number of available beds, not having redundant electrical systems.

For hospital administrators trying to keep their institutions in the black, disaster-resistant infrastructure is expensive and lacks the sex appeal of robotic surgery suites and proton-beam cancer therapy to attract patients.

Cell Phone thefts on rise in major cities.....Increased risk of Data Theft!

Police report that nearly half of ALL robberies in San Francisco this year are cell phone related - and most occur on transit lines.

Thefts of cell phones - particularly the expensive do-it-all smart phones - are costing consumers millions of dollars and sending law enforcement agencies and wireless carriers scrambling for solutions.

New York City Police report that more then 40 percent of all robberies now involve cell phones. Cell phone thefts in Los Angeles, which account for more then a quarter of all the city's robberies, are up 27 percent from this time a year ago

For the employer, increased thefts present also the issue of breech of data privacy - especially as it relates to the usage of company devices. Most employers consider information stored on company phones to be proprietary validating the reason for 'wipes' when employees leave or are terminated from a company.

Market consolidation seen as threat to Physician-owned hospitals!

The newest threat to physician-hospital ownership is market consolidation that has led to hospitals aggressively pursuing medical specialists, according to a speaker at the 12th annual conference of the physician-owned hospital trade association, Physician Hospitals of America, being held in Austin, Texas.

Kevin McDonough, a senior manager with Dallas-based consultant VMG Health, called specialists “the lifeblood of physician-owned hospitals,” and he said physician-owned hospitals are facing a growing inability to replace aging physician investors and recruit new doctors to their ranks.  Another speaker, Clinton Flume, a manager with VMG, said consolidation is being driven in part by a “herd mentality,” where one hospital is seen as “gobbling up practices” and competing hospitals become motivated to do the same.

Physicians are also driving consolidation, Flume said, as they seek employment as a way of being shielded from market forces, including reimbursement cuts—especially for cardiologists—and increasing costs for malpractice insurance and information technology. Hospitals are also seeing physician employment as the answer to staffing and on-call shortages, he added. Flume explained why a previous physician-acquisition trend in the late 1990s was “more or less a bust” as hospitals paid too much for practices and didn't receive a return on their investments while physicians became unmotivated because of a lack of decision-making authority and frustration with how hospitals managed their practices.  These pitfalls are being avoided in this acquisition cycle, Flume said, by basing future physician compensation on past productivity and developing arrangements that allow doctors to practice more independently than they did in the late '90s.

Is Hospital and Physician Group consolidation driving up the cost of medical care?

The California attorney general has launched a broad investigation into whether increasing consolidation among hospitals and physicians groups is pushing up the price of medical care, reflecting increasing scrutiny by anti-trust regulators of medical-provide deals.

The probe, which has been under way for several months, is examining hospital systems’ reimbursement from major California health insurers. The regulator appears to be focusing on whether the systems’ tie-ups with physicians, as well as ownership of hospitals, have given them the market power to boost prices in a way that violates anti-trust law.

Nationally, health-care providers are rapidly merging into bigger health systems, moves that are presumed to improve efficiency. The number of hospital consolidations in 2011 was 86 – the most since 2000. Health Affairs journal suggests that concentration among health-care providers can indeed drive up health-care prices.

Health-Care Costs Rise!

Not surprisingly, a WSJ report states that "Workers should brace for more out-of-pocket costs next year".

Most employers are planning to shift health-care costs to their employees in 2013 to help offset rising premiums.

In all, 58% of employers - a mix of large, medium and small - said they plan to increase employee contributions in 2013 continuing a trend that has persisted since 2005.

Prior to that, generally, only one third of employers said they planned to shift costs.

The Great Value in Dependent Eligibility Audits!

Reduce current and future health care costs now!

* Verify that only eligible dependents have access to receive health care coverage.

* Remove costly ineligible dependents.

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* Demonstrate Fiduciary Responsibiity - only pay benefits to eligible participants.

* Give plan sponsors insight into potential issues.

Guaranteed savings if 250 plus employees.