President Obama Signs Health Care Bill into Law

On the Hill
President Obama Signs Health Care Bill into Law

Final bill specifies that agents and brokers will be able to sell health insurance both inside and outside of exchanges.

Late Sunday night, using some unusual tactics to ensure Congressional approval, the U.S. House of Representatives simultaneously passed the Senate health care reform bill, along with a package of changes to the bill through a rare parliamentary procedure known as “reconciliation”. On Tuesday, President Barack Obama signed into law this bill which represents the most sweeping health care reform package since the Great Society of the 1960s that created Medicare. The reconciliation bill must now be passed by the Senate and the House in identical form before it’s sent back to the president for his signature.

The Big "I” is disappointed that after months of negotiations, hearings, debates and votes in multiple Senate and House committees the final bill does little to stem the skyrocketing cost of health care and will be partially financed through tax increases on certain individuals and small business during one of the most perilous financial periods in American history. However, it’s important to note that, due to the efforts of the Big “I”, significant improvements were made to the legislation throughout the process to ensure a role for the independent insurance agent in the future health care market. Without these changes, the negative impact on the independent agency system would have been much greater.

There will be a number of changes in the delivery of health insurance which both agents and consumers will experience because of the new law. For the first time, individuals will be required to purchase health insurance, and businesses with more than 50 employees will be required to offer health insurance coverage or be forced to pay a fine.

The Congressional Budget Office (CBO) estimates that 32 million new Americans will be on health insurance rolls by 2019, with 16 million of these being new private market consumers, and the remaining 16 million obtaining coverage through a major expansion of Medicaid. Temporary small business tax credits will be available for some businesses with less than 25 employees, and millions of individuals will receive new government subsidies to help them purchase health insurance. The legislation also creates state-based health care exchanges that would serve as catalysts for individuals and small businesses (up to 100 employees) to claim subsidies and purchase health insurance.

In a major win for the Big “I”, the final bill specifies that insurance agents and brokers will be able to sell health insurance both inside and outside of these health insurance exchanges. As a result of the Big “I” grassroots effort and our special “Health Care Fly-In” last summer, individuals and small businesses that choose to purchase through an exchange will still be able to count on the sound advice of independent insurance agents and brokers.

One of the most worrisome aspects for small businesses is how Congress elected to pay for the reform. In order to finance the reform effort, the expansion of Medicaid, and the new subsidies for low-income Americans, a .9% Medicare surtax will be imposed on some individuals as well as small businesses that file as individuals. A new 3.9% tax on nonwage income for these same individuals and successful small businesses will also be imposed. In addition, this tax is not indexed to inflation and therefore will capture more and more taxpayers over time. The Big “I” is greatly concerned about the impact any new taxes will have on small businesses and individuals that are still struggling through the current economic climate.

According to the Congressional Budget Office (CBO), the final price tag is estimated to be $940 billion of taxpayer dollars over ten years. The CBO also projects that small businesses will see little to no decrease in their monthly premiums and individuals will see an increase of 10-13%. The impact on premiums reinforces the Big “I’s” view that this legislation was incomplete at best and, though it increases the number of Americans with insurance, it does not adequately bend the cost curve of health care for the future. Furthermore, it is expected to balloon the federal budget deficit over time, instead of containing costs as necessary. The Big “I” is also concerned that the package did not meaningfully address medical malpractice reform, an issue that the Big "I" has strongly supported including in the final bill in order to help bring healthcare costs down.

Early Thursday morning, the Senate Parliamentarian ruled in favor of two minor Republican “points of order” on the reconciliation bill unrelated to the underlying health care bill. The Senate then approved the reconciliation bill by a vote of 56 to 43. Because of the two points of order, the House of Representatives will have to vote, one last time, on the Senate approved reconciliation text. Final votes on this reconciliation bill are expected this evening or tomorrow morning.

Margarita Tapia (margarita.tapia@iiaba.net) is Big “I” director of public affairs.

UAIIA Newsletter - February 2010

1. UAIIA’s 91st Annual Convention Recently a convention packet was sent out by email for UAIIA’s 91st Annual convention to be held in St. George on April 18th through the 21st. If you didn’t get one, you will be able to find it at www.uaiia.org. Click on the convention button.

It will be a great time to get away to St. George to enjoy golf, great food, entertainment, important industry updates, trade show, CE and networking with our company partners. We hope you’ll be there.

By the way, if you know someone who is deserving of receiving agent, young agent or company person of the year, I encourage you to make a recommendation. There is a form included with the paper newsletter or you can find one at: www.uaiia.org/_private/2010nominationform.pdf.

2. Proof of Insurance So what is the best way of providing proof of insurance coverage to a lender? We have a one page memo with a concise explanation for agents to use with their clients regarding Evidence of Property Insurance Form (ACORD 27) and Evidence of Commercial Property Insurance form (ACORD 28). To access this memo, go to www.uaiia.org/_private/proofofinsurance.pdf.

Should you have any questions about this memo, please contact bill.wilson@iiaba.net.

3. Job Opening – Resumes Wanted After 23 plus years with UAIIA, Steve Baugh will be stepping down as Executive Director due to health related issues. Resumes for this position will be accepted between now and April 10th. Salary will be commensurate with experience. In addition to a resume, we would like a letter stating why you would like the job and your salary requirements. A position description can be found at www.uaiia.org/_private/jobposition.pdf. Please send these items to stevebaugh@uaiia.org. A new Executive Director will be hired no later than September 1st, 2010 and quite possibly prior to that date.

4. Acting Commissioner Announced Neal T. Gooch was recently appointed as Acting Insurance Commissioner of the Utah Insurance Department. Governor Gary R. Herbert said that the appointment would extend “until the selection of a permanent Commissioner is made.”

Mr. Gooch has had extensive experience with the Insurance Department. Beginning in 1986 while serving in the Attorney General’s Office, he was made general counsel to the insurance department. He served in that capacity until August of 1997 when appointed by Commissioner Merwin U. Stewart as deputy commissioner then asked to continue in that capacity by Commissioner D. Kent Michie in 2005.

5. Allstate Agents To Be Terminated Thousands of existing Allstate agents are to be eliminated within the next two to three years as the company sheds those it thinks are not meeting specified production quotas, according to the National Association of Professional Allstate Agents.

Association Executive Director Jim Fish said many of these agents are “older agents – 50 to 60 years old – who might be servicing their book of business and maintaining high retention and loss ratios, but that isn’t enough for Allstate.”

“They (Allstate) are looking to add high-value, production-oriented new agents” to hit marks on new business and premiums the NAPPA says are established by Allstate. Fish said the “so-called” Allstate independent agents are anything but, constantly controlled by the company in “every aspect of the business” from hours of operation and holiday schedules, to personnel requirements.

6. Thanks to Utah InsurPac Contributors In 2009, UAIIA was the first state in the country to meet their goal for InsurPac contributions. InsurPac allows us to help national legislators raise money for their campaigns. This in turn gives us access to them for discussion of our issues. Some people don’t like how this works, but that’s how the game is played back there and we need to protect our interests.

Craig Wiseman is UAIIA’s 2010 InsurPac Chairman. If you would like to donate, you can reach him at (801) 377-3060.

The Independent Agents and Brokers of America, through InsurPac, has now become a million dollar political action committee. We thank the following members of our association for their contributions in 2009.

Platinum Club ($2,500)

C. Brett Nilsson

Gold Club ($500)

Douglas Ball

J. Curtis Breitweiser

Joseph E. Hansen

Pioneer Club ($250)

Kay L. Howland

Eric Kingdon

Kenneth Miller

Craig Timothy

James Welch

Craig Wiseman

Robert Wiseman

Founders Club ($150)

Steve Baugh

John Fogg

Roy Nikas

Tom Stanger

Allen Steadman

Greg Vause

General Contributor

Celeina Cullum

Howard Green

Cheryl Lyman

Richard Tatton

Michael Vowles

7. Helping Hands For Haiti Dr. Jeffrey Randle from Utah has provided housing for orphans in Haiti and a medical clinic. Currently the clinic and housing has been destroyed by the earthquake and the orphans have been sleeping in a field with no tents. You may have seen Dr. Randle on the local news after the quake. His practice is in Salt Lake City and he is planning to go to Haiti shortly.

If you would like to help with a donation, go to: www.helpinghandsforhaiti.com.

8. Scholarship Applications Available Do you have a child who is a senior in high school with a 3.0 grade point average? If so, they may be eligible for one of our 2010 college scholarships. Each year with the help of generous donations from individuals, companies and associations, we raise enough money to give away several scholarships. For further information, go to: www.uaiia.org/_private/scholarship.htm and check out how many recipients there were in 2009.

9.The Pain May Continue Some economists have declared the Great Recession over, but its lingering effects will continue to chip away at commercial property/casualty premiums through 2010 according to insurance experts.

A new Advisen Ltd. Briefing says that the damaged economy will keep rates from rising while at the same time sales, payroll and other measures of exposure used to calculate premiums may fall further. The cumulative effect will be another year of lower written premiums – a boon for insurance buyers – but a painful and potentially damaging situation for some insurers and agents.

10.Twitter Insurance? Bloggers may be wise to purchase insurance. A lawsuit was filed last year against Courtney Love by a designer who claimed to have been libeled by the rock singer on MySpace and Twitter. A number of similar lawsuits involving social networking sites have been filed, and those who share their disputes in cyberspace expose themselves to lawsuits and could face large legal bills. Bloggers may find it worth the expense to buy insurance to protect themselves against lawsuits involving claims of libel or defamation. The Media Law Resource Center reports that a court awarded an Ohio woman $129,794 in damages because a blogger said that her property was haunted, and another blogger was ordered to pay $1.8 million in damages for referring to a plaintiff as a failed lawyer.

11.Easy C.E. The 2008 Legislature passed a bill that gives members of a professional association 2 hours of continuing education credit yearly for their membership. You can receive this credit through UAIIA only by contacting our education coordinator Cheryl Lyman by email at cheryllyman@uaiia.org with your license number and what year/years you would like credit for.

This bill went into effect June 1, 2009. If you belong to more than one professional association, your Sircon account will probably show additional CE credits. It will be your responsibility to make sure that you have only included 2 hours of association credit per year in your total continuing education credits.

12.24/7 Customer Service Have you ever thought about outsourcing your agency customer service? InSite Support Services, Inc. can give your agency 24/7 customer service. For further information go to: www.insitesupport.com or call 803-405-7265 or toll free: 866-446-3555.

Insurers Would Owe Under Proposed U.S. Financial Tax (Wall Street Journal)

18 Jan 2010

A handful of large insurance companies, most of which turned down government bailout funds, would likely owe money under the proposed Financial Crisis Responsibility tax.

The proposed tax, unveiled Thursday by President Barack Obama, would amount to 0.15% of total assets minus high-quality capital, such as common stock, and disclosed and retained earnings. Insurance-policy reserves would be untaxed, being already subject to federal fees, according to the White House, but analysts and insurers note that some details are yet to be clarified. The fee must be approved by lawmakers.

Quite a few insurers qualify for the tax, according to analysts. According to a fact sheet from the Obama administration, the fee would cover large insurance and other companies that own insured depository institutions.

American International Group Inc., MetLife Inc., Prudential Financial Inc., Allstate Corp., Lincoln National Corp., Hartford Financial Services Group Inc., Ameriprise Financial Inc. and Principal Financial Group all are eligible for the tax, based on total adjusted assets, according to a Friday report by Credit Suisse.

A note from Citigroup on Friday included all those companies except Allstate.

AIG's main business is insurance, but it was the company's financial trading business that led to its multi-billion-dollar bailout. It would owe the most tax of the insurers, at an estimated $388.8 million based on a full year, according to the Credit Suisse estimate, and $367 million according to Citigroup.

Two other life insurers that took bailout funds would fall under the tax, according to analysts. Hartford Financial received $3.4 billion from the Treasury's Capital Purchase Program and would owe tax of about $28.2 million by Credit Suisse's estimate.

Lincoln National received $950 million from the program and would owe tax of about $29.4 million, according to Credit Suisse.

In an emailed statement, Hartford said it was evaluating the proposal but that it was too early to tell what effect it would have on the company. "This is an initial proposal that is likely to go through a number of modifications over the course of the next several months," the statement said.

Lincoln National didn't respond to a request for comment.

Prudential and MetLife, two insurers that declined funds from the Trouble Asset Relief Program, would owe significantly more, according to Credit Suisse and Citigroup. Prudential would owe about $85.2 million, and MetLife just over $81.5 million, Credit Suisse said; Citigroup pegged Prudential at $84 million, and MetLife at $97 million.

Prudential spokesman Bob DeFillippo said the company was working on understanding the proposal and didn't yet have a comment.

A MetLife spokesman agreed with the assessment that the company is included in the current proposal of companies that would owe the tax but said the company is still looking at the details of the proposed tax.

Allstate would owe $34.1 million, according to Credit Suisse. A spokesman said, "At this point, we don't have enough information to determine whether or to what extent a company like ours, which did not accept TARP funds and whose assets primarily are funds held on behalf of contract holders or insurance policy reserves, would be affected by this fee."

Ameriprise and Principal Financial didn't reply to requests for comment.

One consequence of the tax falling on the biggest insurers is that it would make them less competitive, said bank analyst Mike Moebs of Lake Bluff, Ill. "This will help smaller insurers," he said. "It will put them in good position to compete," particularly in specialized insurance markets.

The Passing of Jay Hadley

To: UAIIA Membership

From: Steve Baugh, Executive Director

I learned that Rodd Hadley recently passed away. I remember when Rodd was a marketing representative for Unigard. He had a good reputation in our industry and was an all around good guy. Below is his obituary. Our sympathies go out to his friends and family.

Steve

JAY HADLEY

Jay Rodney Hadley 1932 ~ 2010 A "Good Man" A "Good Man," Jay Rodney Hadley, loving husband, father and grandfather, died suddenly Saturday, Jan. 2, 2010 of heart failure. Born, October 26, 1932 in Ogden, Utah to John Hipwell Hadley and Laura Thurston Hadley, the youngest of 11 children. Rodd graduated from Ogden High School, Weber College, and Brigham Young University. He married Carol Barker October 30, 1953in the Salt Lake Temple, and shortly after left for an LDS mission to Uruguay for two and a half years. He was active in the LDS Church and held positions in several bishoprics, and was a "beloved" Sunday School teacher for many years. Rodd worked for Northwestern Mutual Insurance in San Francisco, California and Unigard Insurance Group in Salt Lake City where he retired after 30 years. While there, he achieved many awards, including the "National Marketing Representative of the Year" and was honored at the national convention in Atlanta Georgia. Upon retirement, Rodd worked for the next 20 years in the travel industry, most recently at Hess Travel of Bountiful, Utah where he thoroughly enjoyed the job and all of the employees he was associated with. Rodd had a lifetime love of sports. Playing for many fast pitch softball teams in Boise, Idaho where our family lived for four years, and then later in the Salt Lake Valley where his teams won many championships, including the "All Church Fast Pitch Softball Tournament." He coached both sons in Pony League Baseball, and was an avid BYU fan for 50 years, as well as New York Yankees fan since childhood. His love of sports extended to his granddaughter and grandsons where he faithfully attended all of their sporting events with such pride. His happiest days in life were spending time with his family and especially his four grandchildren who lovingly called him "Pop." He was preceded in death by his infant son, David, and survived by his wife of 56 years, Carol, his children and grandchildren: Richard Ririe Hadley and wife Ellen Eads and their children - Kate, Jacob and Cody; Nancy; Jon Thurston Hadley and wife Mary Taylor and son, McKay. Private family graveside services will be held at 2:00 p.m. in the Bountiful City Cemetery. The services will be handled by Russon Mortuary of Bountiful with Bishop Meik Rapp of the Bountiful 23rd Ward officiating. In lieu of flowers, please send donations for Sudden Infant Death Syndrome to Primary Children's Foundation, C/O SIDS, P.O. Box 58249, Salt Lake City, Utah 84158 Things grandson McKay (age 4) will miss most: "sleeping over at Pop's, pampakes and chocolate milk." "Dear Pop I love you, and I am so glad I will be able to see you again. Thank you for making me laugh, I have so many memories. I am so privileged that I had you, and still have you in my life." by granddaughter "Katie" (age 14 1/2 ). "Grandpa was always up and going, and he was always happy" - written by grandson Jacob (age 11 1/2 ). "Pop was a good man and a good grandfather. On January 8th I am going to have a basketball game and he will be there - I know it because he's a part of our Forever Family. Pop and Gram always come to my games" - written by grandson Cody (almost 9).

The Passing of Charles Eubank

To: UAIIA Membership

From: Steve Baugh

It's with sadness that I report the passing of Charles Eubank, a Past President (1954 - 55) of our state association on November 24, 2009. Mr. Eubank stayed in touch with our industry through Blue Goose and by attending our Past President's events over the years. Most recently, he had attended our Convention Banquet this past June at the Zermatt Resort.

A memorial of his life will be held at 2:00 p.m. on Sunday, December 20th, 2009 at 650 East South Temple, at the Salt Lake Masonic Temple.

Please see his obituary below.


CHARLES EUBANK Sr.

Charles Stuart Eubank, Sr. In the Arms of the Angels Dad, Granddad, Chuck, Charlie, Sr., Old Fart or the Big Guy - by whatever name you knew and called him, Charles Stuart Eubank, Sr., will be deeply missed and fondly remembered by all whose lives he touched. He found his peace on Tuesday, November 24, 2009. Husband to the late Betty Willingham Eubank; Father to Chuck, Sara, Carlyle and the late Wallace; son to Mildred Barton Eubank and Carlyle C. Eubank; Grandfather to 12 "not a bad egg in the bunch" grandchildren who gave him seven great-grandchildren as well as a friend to many; Chuck lived life fully and with great gusto and spirit. Chuck was born in Ogden, Utah on February 11, 1924 and graduated from Ogden High School. He was a member of the United States Navy from 1943 to 1946 where he served as "Photographer's Mate" and had the honor of photographing some of his country's top commanders in chief while stationed in Washington D.C. Chuck married his sweetheart, Betsy, in Washington D.C. in 1946 where they made their first home, while he finished his degree at American University. Chuck and Betsy moved to Ogden, Utah in the late 40's where he began his career at Eubank Insurance which was founded by his father Carlyle. He worked in the insurance and construction bonding business from 1949 to 1992; was President and CEO of Eubank Insurance & Bonds, serving clients throughout the Intermountain West. Chuck's integrity was well known throughout the Utah business community, the Intermountain West and California. Chuck received numerous awards for his achievements in the insurance industry - and was known for his "purple felt-tip pen". Chuck was very active in community building and gave generously of his time and talents. The following are but a handful of the Boards of Directors on which he served: The Ogden School for the Deaf and Blind, the Bertha Eccles Art Center, and The Utah Women's' Clinic, and The Martha Home for Children. He was an active member of the George East Duck Club as well as the Exchange Club of Ogden, serving as President for a year. Chuck was involved in the Ogden Judo Dojo, the Boys Scouts of America and the PTA. He was an avid supporter of the Golden Spike Livestock Show which was co-founded by his grandfather, Charles H. Barton and very supportive of the activities of the Junior League of Ogden which included many years building and maintaining the enchanting Christmas Village that delighted youngsters and oldsters alike. Chuck also supported the Diplomatic Reception Rooms at U. S. Department of State where one of his sons serves as Chairman of the Fine Arts Committee. Chuck gathered friends wherever he went, all of whom he held very dear. His companion for the last fifteen years is Betty Jo Stevens of Salt Lake City, Utah. BJ has been a constant friend, companion, gardening partner and confidant. There are other people, too numerous to name, who helped Chuck during the last ten years of his life. To all of you, the family says "Thank You and we appreciate you". At his passing, Chuck was a member of "Blue Goose" a group of insurance professionals, Wasatch Lodge #1, Free and Accepted Masons of Utah and Scottish Rite of Utah and was a member of The Living Tao Tai Ji Family. The family wishes to extend our thanks for the loving and compassionate care that Chuck received at The Residence of Care Source Hospice during the final few weeks of life. Chuck is survived by Charles S. Eubank, Jr. (Gwen) and their children Mary Guerrero (Tin) and their children Izabella, Pixie and Aleko, Lee (Meggan) and Charlie (Megan); Sara Eubank Moffitt (Dave) and their children Michel Spruance (Peter), Megan Betty Williams (Gabe), and Elisha Moffitt; Carlyle C. Eubank, II (Patricia) and their children Rosanna Dude (Vince) and their children Luke, Kai and Molly; William, Carlyle and Winchester; and the children of the late Wallace W. Eubank, Katie Fehr and her son Trace, Jennifer Decker (James) and Melissa (Mike). Chuck enjoyed a fruitful life and is his words "the baggage of the past has been discarded and the future holds only rainbows, flower gardens and loving kindness. God is Love and loving kindness can and will sustain the world". A memorial of the life of this well loved man will be held at 2:00 p.m. on Sunday December 20th, 2009 at 650 East South Temple, at The Salt Lake Masonic Temple. A celebration will follow at a time and place to be announced at the memorial service. Please join us to share your memories and celebrate life the way he lived his. In lieu of flowers, donations may be made to The Humane Society of Utah, Best Friends Animal Sanctuary in Kanab, Utah or The Salt Lake City Shriners Hospital for Children Transportation Fund. Online condolences at www.jenkins-soffe.com