Health and Disability: 5 things to expect in 2013

By National Underwriter

National Underwriter

By Allison Bell

In 2013, we will go from wondering when the unsustainable U.S. health insurance market will collapse to watching it start to shimmy and shake like a gelatin skyscraper. The market isn’t supposed to fall apart in the coming year – but watch out for globs that ooze out early.

1. Fighting tooth and nail for market share.

Companies will be bidding viciously for Patient Protection and Affordable Care Act (PPACA) exchange building contracts, and crying bloody murder and suing when they lose out to other bidders. On the upside, though, this much competition is bound to be a truth machine for the industry, with the really sharp firms coming out on top, both in terms of service provided to the customer, and in results for themselves.

2. Still more legal wrangling.

The Supreme Court will take up some case or another that will give everyone with a stake in the birth of the exchanges palpitations. Back in June, the court did not “uphold PPACA.” It simply upheld one key provision of PPACA, the provision calling for PPACA to impose a tax on people who fail to buy health coverage. There’s plenty of PPACA left to challenge. And not all of it is guaranteed to survive.

3. The price of procrastination.

Canny individuals will put off coverage decisions late in the year, or make strange coverage decisions, in anticipation of being able to get better deals in 2013. This will be especially true of older consumers with health problems in states that still allow full medical underwriting.

4. Growth in group disability.

Maybe group disability insurers will start to report growing group disability case sizes, rather than ongoing in-group attrition. Employers have to get bored with shrinking sooner or later. Providing the economy doesn’t go off the fiscal cliff in 2013, the prospects seem good for some kind of economic recovery, even if only a modest one.

5. Finally, climbing out of the trench.

Interest rates will start to spike up at the end of the year, and the companies that held on to their long-term disability and long-term care insurance operations will suddenly look as if they’re run by rocket scientists.

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