00:23 — Introductions

2:12 — Timeline for Transitioning out of Group Medical Plans

3:45 — Ancillary Coverage expanding

4:43 — Group Medical Level Funded Plans Renewals & Surplus Policy

7:06 — Humana’s Other Verticals

8:01 — 51+ Fully Insured Medical Plan Transition Timelines

10:07 — Humana as a Group Specialty Carrier

Speaker 1:

It is time for another carrier product update. Tune in as we talk directly to the carriers about their new plans, any new network options they have, or which plan designs offer the most savings and learn about the tools and resources they offer to help you generate more business. Visit our website to learn about all of the carriers we quote in our carrier product update series.

Jason Powers:

Hi, welcome back to our carrier product update series. I’ve got a very special announcement here for this carrier product update with Humana Insurance Company. I’ve got David Brown with me, good friend of mine. We’re going to just talk to you about the Humana transition, the recent announcement about Humana exiting the commercial group medical market, but staying in the ancillary markets and what that means for your clients. David, welcome back.

David Brown:

Thanks, Jason, and happy St. Patty’s Day.

Jason Powers:

Happy St. Patty’s Day. It is, yes.

David Brown:

Where’s your green?

Jason Powers:

Green’s in my pocket. Green’s in my pocket. A fancy shirt.

I don’t have the green Humana logo. Well, David, I know the announcement that came out a couple of weeks ago here had a lot of us, I think reminiscing a little bit. For me, it was a tough email to read knowing that I had immediately fought back to broker experiences in Green Bay, the field underwriting days and the amazing times that we’ve all had with our friends at Humana. But this isn’t goodbye to Humana in its entirety as a company. Humana is staying in the ancillary market, right?

David Brown:

Correct.

Jason Powers:

But this is more about what’s going on in the group medical side, what kind of timelines there are, and what options groups have as they approach their anniversary date. So what does that look like? We have agents all across the country, and I know your specific territory is Kansas and Missouri, but what does it look like from a company-wide perspective, how is Humana handling that transition?

David Brown:

Sure, sure. So for those that don’t know, Humana did announce two weeks ago that we are exiting the commercial medical market and all of our markets. That means that Humana’s still going to be on the ancillary or specialty side selling business. So we’re not going away. We also have the verticals in our commercial Medicare markets and Medicare Advantage, Medicaid as well as military. So we have all the verticals there. We’re just getting out of the commercial medical market. What does that look like? So effective 4/1, on the small business side, Humana will no longer sell level funded premium products.

The exiting of the marketplace will differ based on the state that Humana has clustered into different categories. So the exiting strategy will be starting November 1st of this year and then go November, December and January where we will start stop selling medical business in certain markets. Until then, it’s business as usual. So if you have a current Humana client, they can renew as is. For Kansas and Missouri specifically, our cluster end date is November 1st, 2023. So we will offer renewals up until 10/01/2023 business as usual. Then the following year, they will not be offered a renewal and we’ll be completely out of the business in Kansas, Missouri on 11/01/2024.

Jason Powers:

Got it. But we’re still able to sell ancillary Humana on all of those segments regardless of effective date?

David Brown:

Correct.

Jason Powers:

So if you’ve got a case that has medical, dental, vision, the medical will have an end date, but the dental and vision and potentially other ancillary products will still stay intact.

David Brown:

Yes. Well, we’re hopeful that you’ll maintain and keep that business, that block of business with Humana and then grow that specialty business as well. A couple new things on this specialty side is that we are going to start offering disability, I believe that start date’s around “date for a 7/01 effective date” for a 9/01 actual effective date. And we’re also looking into enhancing that product portfolio on the work site products as well. So we will be a full specialty carrier at that time, offering all lines of business, one billing statement for all those lines, those types of things.

Jason Powers:

Got it. So then back to the group medical side, especially on the level funded premium plans, those tend to have an opportunity for surplus, and Humana generally returns, I think it’s 100% of the surplus minus a terminal reserve fee of 6%.

David Brown:

Correct.

Jason Powers:

I always tell people it’s really 94%.

David Brown:

94%.

Jason Powers:

94%. But I say it your way, the 100% minus the terminal reserve. So cases that are up for renewal, we’re in March. So looking at April, May, June, July, August, September, and then October, effective dates, those will still be offered renewals. And then what happens, those cases, if I’m correct, if they move at anniversary to another carrier and they have a surplus, they forfeit that surplus.

David Brown:

Correct. So really what we’re saying here is from the renewal dates from now until 10/01, effectively this year, if you leave Humana to move to another carrier, you will not get the surplus. Now, if the group renews on 10/01 of this year and then they go through the whole cycle, 12 month cycle till next year and they’re not offered a renewal and there’s surplus, at that point, they will get a surplus. So really after 11/01, groups, 11/01 effective dates, if the group cannot renew and there’s a surplus, Humana will give that group a surplus. It’ll be in the form of a check 90 days post termination.

Jason Powers:

Makes sense. So then we’re talking… this is 2023, so we’re talking 11/01, 12/01, those 1/01 cases, or if we just had cases that signed up February or March, when those come around, they won’t be offering renewals.

David Brown:

Correct.

Jason Powers:

If there is a surplus, Humana will return that surplus 90 days. The reconciliation is 90 days after the end of the contract, so good news for those cases, and I think that helps really in that transition with those cases from now until October, I think it helps be a little bit of a breathing room for those…

David Brown:

Yep. Business as usual.

Jason Powers:

Business as usual.

David Brown:

Business as usual. As mentioned before, we’re still in the business with specialty and all the other lines of business. So we will have a customer service team there. That’s not going away. It’s not like we’re shutting all the doors at Humana. It’s just the commercial medical segment.

Jason Powers:

Yeah. Because Humana does much more than just commercial group. So you’ve got Medicare business, the ancillary side, the Medicaid side, and all those other lines are staying in intact. It’s just the commercial group medical side.

David Brown:

Correct.

Jason Powers:

And as it pertains to… so that we talked about level funded, but on the fully insured ACA plans, is it the same? Well, it’s the same timeline.

David Brown:

Yeah. So we’re shutting down selling level funded premium with a 4/01 effective date across the board. So after 4/01, no more level funded premium. However, we will still offer 51+ fully insured. So even 100+ plus or 150 person group, we would still write new business up until that term date, which again for Kansas, Missouri, as they could write up new business until 10/01/2023 this year.

Jason Powers:

Got it.

David Brown:

Again, business as usual from that standpoint. I did want to note here in Missouri that community rated has been turned off for a 4/01 effective date as well. But community rated is still open in other markets until that term date, whenever that is determined up for that state. So in Kansas, we can write community rated up until 10/01 of this year.

Jason Powers:

Got it. All right. And so we’ll have some clarity on the clusters of what that transition looks like by… because we do have agents across the country. I think by our primary cluster, if you will, of brokers that sell Humana are in the Kansas, Missouri market, so this is timely information for them, but other areas of the country, Humana’s phasing out the group medical maybe 11/01, 12/01, and 1/01.

David Brown:

Yeah. Yeah. There’s just three clusters on a monthly basis. So 11/01, 12/01, 1/01, depending on what state you fall into is when that end date will happen.

Jason Powers:

Okay. And we’ll have that information posted underneath this video here on our website in the Humana product page. So if that applies to you, if you’re not in the Kansas or Missouri market, you’ve got specific questions about which cluster your groups fall into, just reach out. We’ll be happy to help you with that transition. David, anything else that agents need to know as they work on this transition over the course of the next year?

David Brown:

Well, I think the biggest thing is, Jason, is just don’t panic. Again, it’s business as usual. If you have a Humana client that’s coming up for renewal, look at that renewal and so forth. You will get the best customer service possible. And again, you need to start looking at Humana as a specialty carrier on the group side of things. And the same exceptional service that we’ve offered in the past, the same handholding and things like that, the culture that we provide that you’ve experienced over a long time will still be there. Just be on the specialty side or the ancillary side. And we’re looking forward to a new chapter and the evolution of Humana really.

Jason Powers:

Yeah, we are too. Well, we appreciate you coming in and talking to our agents today. If you have questions about groups that you have with Humana or questions just in general about the transition, feel free to reach out to our office and our staff is ready to answer those questions and help you out. Until next time, David, thanks so much. This is not goodbye. I’m going to see you…

David Brown:

Will be around.

Jason Powers:

Yeah.

David Brown:

Will be around.

Jason Powers:

But I do appreciate you taking the time here in the early morning here.

David Brown:

All right. Thanks Jason.

Jason Powers:

On St. Patrick’s Day. We’ll see you next time.

Speaker 1:

Thank you for watching this edition of our carrier product update series. Visit our website to watch other episodes.