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President, Croley Insurance & Financial
President, Croley Insurance & Financial

2015 Economic Outlook: Trevor Croley

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Trevor Croley has a front-row seat to a health insurance marketplace he calls the most volatile in his 17-year career.

2015 Projection
“The Senate and Congress are going to figure out a way to allow employers that have maintained their health plan to renew it once again.”

SBJ: What are the biggest challenges in insurance this year?
Trevor Croley: The greatest challenge overall is figuring out how the Affordable Care Act is going to affect each one of the employer categories.

Under 50, and that’s probably the largest segment in southwest Missouri, those are the employers we’re really concerned about. This year, they will have to meet the guidelines of the ACA. Before, a lot of us had a strategy to keep our health plan and not meet the suggested guidelines. This next year, we won’t be able to do that. We have seen, in our own business, the rates are tremendously different than what they were on a comparable plan.

Rate increases in the past around here averaged 8-10 percent. That’s not going to happen. If you were able to keep your plan this year, those rate increases next year are going to be substantially higher. It’ll be somewhere between 10 and 15 percent and don’t be surprised if its more than that, especially for a comparable plan.

SBJ: What’s the net effect of that?
Croley: A lot of those small employers, under 50 employees, are seriously going to consider whether it’s worth it to be in the health insurance game. It is meant to be an employee benefit. An employer doesn’t necessarily offer a health benefit because they have money to blow. It’s usually because they want to attract and retain certain employees. For years, it was a standard. But as these plans have become so darn expensive, in certain circumstances, it’s better to let employees go out and buy their own, especially if they have certain income categories.

SBJ: Are we entering a reshaping of how employers view benefits? Is health coverage no longer the employee perk it once was?
Croley: Only because of the cost factor. There is a point with anything that someone is going to say this is no longer a good deal. I don’t hope that’s the situation because this is part of our livelihood. But as a realist, I understand the dollar can only go so far. So, if it’s mandated that an employer provide a certain level of benefit and that they have to pay so much of that benefit, either we’re all going to end up paying more for those services and goods to cover those costs or the employer’s going to say it’s better to let everybody go out and do their own thing.

SBJ: Does that mean elimination of small group plans?
Croley: It could be.
It’s kind of set up that way right now. The main argument against going out and buying individual health plans was that prior to the Affordable Care Act, if you wanted to buy an individual plan, you had to qualify for it medically. Now, there’s no more pre-existing conditions and medical underwriting. Everybody gets the same rate based on their age. Everything’s unisex now. You don’t receive the same type of business write-offs that you would because now the IRS says you can’t write off individual health plans. But there’s nothing to say an employer couldn’t just bonus you the money or figure out another benefit than health insurance.

SBJ: Over 100,000 Missourians have enrolled in the federal marketplace for coverage beginning Jan. 1. Who are the winners in this environment?
Croley: Those individuals who are eligible for the tax credits [about 89 percent of enrollees in Missouri]. This is the first wave of people getting access to something people have never had before. It’s great. They come into our office, some people cry, I mean, there are great stories for some of these people who have never had health insurance before. It is awesome.[[In-content Ad]]

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