What the insurance companies are learning about you

Your online trail is being tracked, and now the insurance companies are following you. From The Wall Street Journal:

Data-gathering companies have such extensive files on most U.S. consumers—online shopping details, catalog purchases, magazine subscriptions, leisure activities and information from social-networking sites—that some insurers are exploring whether data can reveal nearly as much about a person as a lab analysis of their bodily fluids. 

In one of the biggest tests, the U.S. arm of British insurer Aviva PLC looked at 60,000 recent insurance applicants. It found that a new, "predictive modeling" system, based partly on consumer-marketing data, was "persuasive" in its ability to mimic traditional techniques. 

This data increasingly is gathered online, often with consumers only vaguely aware that separate bits of information about them are being collected and collated in ways that can be surprisingly revealing.

A key part of the Aviva test, run by Deloitte Consulting LLP, was estimating a person's risk for illnesses such as high blood pressure and depression. Deloitte's models assume that many diseases relate to lifestyle factors such as exercise habits and fast-food diets. 

Other insurers exploring similar technology include American International Group Inc. and Prudential Financial Inc., executives for those firms confirm. Deloitte, a big backer of the concept, has pitched it in recent months to numerous insurers.

Make you nervous? Let the companies know. Here are their contact pages.

Alvia

AIG

Prudential

Deloitte

Planning your health insurance next year

Smart Money looks at the coming changes and makes suggestions:

Plan for price hikes
The rising cost of medical care and new requirements of the reform bill are expected to increase employers’ health costs by about 9 percent next year. To compensate, experts say, firms will raise co-pays and deductibles, the amount paid out of pocket before coverage kicks in. According to the consultancy Mercer Health & Benefits, about 20 percent of companies are also considering making employees with more dependents pay a larger share. For people who could be covered under a spouse’s plan, Barry Schilmeister, a partner with Mercer, suggests doing a fresh comparison to find out whether switching might mean more savings.

Is your doctor in?
Many doctors and hospitals are being “very aggressive” in their negotiations with insurers this year, says Dean Hatfield, national health practice leader for Sibson Consulting, so employees shouldn’t assume their current MD and hospital are still in their insurance network. Those who lose a favorite practitioner may want to opt for a plan with good out-of-network coverage. Another change to look out for: In 2011 the pretax flexible-spending accounts used to cover extra health expenses can no longer be used for over-the-counter drugs unless a doctor writes a special prescription.

Check for new benefits
Not all changes will hurt. Hatfield estimates as many as one in five employers will offer plans with incentives designed to keep employees healthy—like waived co-pays for the inhalers that help asthmatics keep their disease in check. Many employer health plans will be required by law to make other consumer-friendly changes as well, including reimbursing patients equally for emergency room care received at both in-network and out-of-network hospitals.

Coming to a health insurance premium near you

I did not like the headline this morning: health insurance premiums may go up by 20 percent here in Connecticut, where I live. If you don't live here, don't count your blessings.

Matthew Sturdevant reports in The Hartford Courant:

The overall price shift is the clearest indicator yet of what customers and employers can expect when health insurers submit proposed 2011 rates in late October and November. The current round of price requests launches a clash between insurers who say the increases are justified and consumer advocates and government officials who say the numbers are wildly inflated.

Indeed officials at the federal and state level jumped on their high horses to express outrage, but the insurance companies point to specifics in the new law. Anthem, with which we have a policy, says:

Anthem Blue Cross and Blue Shield in Connecticut, by far the largest insurer of Connecticut residents, said in a letter that it expects the federal health reform law to increase rates by as much as 22.9 percent for just a single provision — removing annual spending caps. The mandate to provide benefits to children regardless of pre-existing conditions will raise premiums by 4.8 percent, Anthem said in the letter. Mandated preventive care with no deductibles would raise rates by as much as 8.5 percent, Anthem said.

On Sept. 23, health insurers will be required to comply with an array of provisions that were part of federal health reform laws passed six months ago. New regulations include eliminating cash limits on how much insurers pay per person each year, and throughout a person's lifetime. Insurers won't be able to deny coverage to children under 19 who have a pre-existing medical condition.

"If you fail to recognize that the new requirements around benefits that were passed in federal reform were going to drive price, I think you're being intellectually irresponsible," said Keith Stover, a lobbyist with the Connecticut Association of Health Plans. "Those are new benefits that are going to cost money," Stover said. "You can't just wave the magic wand and say, 'Do all these things, and they're free.' It just doesn't work that way."

I'm no fan of the insurance companies, but I think he has a point.

We'll soon be paying more for health insurance

And it's due to Obamacare, insurers say.

Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators, the Wall Street Journal reports.

About 9% of Americans buy coverage through the individual market, according to the Census Bureau, and roughly one-fifth of people who get coverage through their employer work at companies with 50 or fewer employees, according to the Kaiser Family Foundation. People in both groups are likely to feel the effects of the proposed increases, even as they see new benefits under the law, such as the elimination of lifetime and certain annual coverage caps.

And that's not all, the Journal says. Many carriers also are seeking additional rate increases that they say they need to cover rising medical costs. As a result, some consumers could face total premium increases of more than 20%.