the online individual insurance market - perspectives, experiences and trends october 20, 2008 sam...
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The Online Individual Insurance Market - Perspectives, Experiences and Trends
October 20, 2008
Sam Gibbs, Senior Vice PresidenteHealth, Inc.
The Online Individual Insurance Market - Perspectives, Experiences and Trends
October 20, 2008
Sam Gibbs, Senior Vice PresidenteHealth, Inc.
Today’s Talking PointsToday’s Talking Points
Insurance Industry – Crisis or Opportunity?
The eHealth online solution
Innovation for small business health care – Business HSA
What’s in store for Health Insurance after the election
Questions and Answers
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US Health Insurance CrisisUS Health Insurance Crisis
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Consumers Businesses
47 million uninsured
6.1% unemployment
Shrinking employer sponsored health insurance over last seven years
Extremely High Health Care Costs
Can no longer afford to offer traditional health insurance
Layoffs
COBRA
Unknown access to affordable health insurance
US ECONOMY
- Market Innovator
eHealth – Customer AdvocateeHealth – Customer Advocate
Representing over 180 health insurance carriers nationwide
Through choice consumers find affordable plans “Get insured for the price of a latte per day”
Highly-configurable policies Pay only for what you need
Simplifies complex decision process Compare plans side-by-side based on key features
Consumer-friendly, intuitive interface
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Home PageHome Page
94043
Census PageCensus Page
Quote PageQuote Page
Plan Advisor ToolPlan Advisor Tool
Quote Page & ComparisonQuote Page & Comparison
Physician Finder ToolPhysician Finder Tool
Live AssistanceLive Assistance
Online ApplicationOnline Application
eApproval OvervieweApproval Overview
Complete online experience - instant underwriting
Via direct connection to carriers’ underwriting systems
If approved, coverage starts immediately
Permanent Policy Number Issued
Temporary Coverage ID immediately available to print
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eHealth IFP Customer ProfileeHealth IFP Customer Profile
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Key demographic groups: self-employed, early retirees, SMB employees w/o company-based coverage, students.
As of August 2007 average monthly premiums on active policies ranged from $83 to $388 depending on state of residence
* For Individual Plans.
2007
Average Age 36
% Male 54%
% Single 61%
Average annual premium* $1,896
Average annual deductible* $1,971
Introducing the eHealth Business HSAIntroducing the eHealth Business HSA
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HSA Growth ForecastHSA Growth Forecast
Over the next decade, the growth in consumer-directed health plans and HSAs could be one of the most powerful trends affecting the U.S. economy
HSA adoption expected to grow significantly over 3-5 years:
― The number of Americans covered by HSA qualified plans had grown to 6.1 million as of January 2008 from 4.5 million as of January 20071
― Diamond Consulting estimates 15 million HSAs by 20102
HSA’s are fast becoming an important offering for banks and thrifts:
― HSA’s are a critical lever for financial institutions seeking to maintain profitable long-term relationships2
― The number of banks offering HSA’s has more than tripled between the end of 2005 and June of 20072
1. Survey of health insurers performed by America’s Health Insurance Plans (AHIP)2. Diamond Consulting ,Seismic Shifts in the Health/Wealth Landscape.
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eHealth Business HSA - EmployerseHealth Business HSA - Employers
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eHealth Business HSA - EmployeeseHealth Business HSA - Employees
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Benefits to All ConstituentsBenefits to All Constituents
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Employees Employers
Enhances market opportunity with small businesses
Expected to drive application volume
Same recurring commission-based revenue model
Expected to deepen marketing partner relationships
Gain control over healthcare expenses
Hire and retain workers by enhancing benefits package
Streamline benefit management through easy to use account center
Earn Federal Business Income Tax deductions
Health insurance option for employees not covered through group plans
Access to a broad selection of HSA-eligible plans in many states
Allows pre-tax contributions
Easy-to-navigate account center
Fully portable plans within state of residence
Obama Plan on Health InsuranceObama Plan on Health Insurance
National Health Policy Offering― Guaranteed eligibility, FEHBP style benefits, subsidies for low income
National Health Insurance Exchange― Guaranteed issue; no underwriting; coverage > national plan
Requirements/incentives for employers offer or pay for “meaningful” coverage
Mandated kid coverage
Catastrophic reinsurance
Price Tag: Estimates range from $160* to $452** Billion per year.
*One year average of Tax Policy Center Urban Institute/Brookings Institution estimate An Updated Analysis of the 2008 Presidential Candidates' Tax Plans: Updated September 12, 2008
** Assessment of Barack Obama 2008 Health Reform Plan Health Systems Innovations (August, 2008)
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McCain Plan on Health InsuranceMcCain Plan on Health Insurance
Replaces employee health benefit tax exclusion with flat refundable credit $5000 family; $2500 individual
Cross-state purchasing of health insurance
Expanded availability of HSAs
GAP plan to cover high risk/hard to insure
Price Tag: Estimates range from $130* to 160** Billion per year
*One year average of Tax Policy Center Urban Institute/Brookings Institution estimate An Updated Analysis of the 2008 Presidential Candidates' Tax Plans: Updated September 12, 2008
** Health Systems Innovations estimate of similar proposal Analysis of 2007 Republican Health Reform Proposals (September 2007)
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Post-Election RealitiesPost-Election Realities
Political Realities in 2009:
Momentum for reform not guaranteed (among policymakers and outside groups)
President McCain must face Democratic Congress
President Obama likely to need 6 to 10 Republican votes in Senate
Affordability: Record deficit $438 billion projected by CBO ― $325 billion even after all Bush tax cuts allowed to expire― Likely to go higher with Fannie Mae/Freddie Mac takeover, AMT Relief, and $700
Billion "RTC2" proposal
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Questions and AnswersQuestions and Answers
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Sam Gibbs
Senior Vice President
eHealth, Inc.
(408) 887-1488