- True, President Obama promised what was never possible in the individual market BUT
- Policies were always cancelled and often at times of high medical need and expenses
- With ACA that can no longer happen BECAUSE
- No one can be denied health insurance
- There are many options for insurance AND
- The new policies are much more substantial than the ones being cancelled. Lots of policies were almost worthless AND
- The costs, especially with the subsidies are much more affordable for real coverage AND
- All of the consumer protections are in place: no one can be denied a policy, no lifetime or annual limits AND
- No more job lock. With options for group insurance outside of working for an employer who offers insurance, options where no one can be denied a policy, people can choose to work where they want. This is a boon for entrepreneurs who want to open their own businesses. There is now a Marketplace Exchange where they can purchase policies in a group rated fashion. Imagine people leaving jobs they hate but only stayed with because they needed the insurance. Farm wives heading back to the farm because they don’t need to work away to get insurance. Families being able to move closer to loved one.
So the media hype that policies are being cancelled clouds the truth of the story. Yes people are scared because they are not yet aware of what their new options really are, they are afraid of change. They are afraid of losing their doctors. The unfortunate reality is that insurance companies have been for years changing networks of doctors annually. One could never be certain of of which doctors were going to be in their plans from year to year. Insurance companies negotiate with doctors and other health care providers annually to find the best fit and prices for the needs of their insured clientele. Obamacare didn’t change that.
As the start date for open enrollment in the Marketplaces nears, polls find more and more confusion about what the health care law means for consumers. It is important to remember that this initial enrollment period will be 6 months long, plenty of time for people to enroll and begin to get comfortable and informed about what the law may really mean for them. Of interest in the polls, young adults seem more favorable to it than do older adults. Given that Medicare beneficiaries are the least impacted population…that is, they do not need to make new decisions about their health insurance, Medicare remains…this is curious. One does wonder whether if the Medicare population could think about this as grandparents of young adults, if they would see additional benefits for those grandchildren, and peace of mind for themselves, for those youths being insured. http://www.washingtonpost.com/blogs/wonkblog/wp/2013/09/16/two-new-polls-tell-us-americans-are-very-very-confused-about-obamacare/?wprss=rss_economy&tid=pp_widget
Not surprisingly, one of the highest risk groups that should make it into the marketplaces are those already in state and federal high risk pools…those who were previously uninsurable anywhere else. Believe it or not, those high risk folks too are to be added, just like everyone else, to the Marketplace with no differential rates for their pre-existing conditions. They will get much more affordable policies in the Marketplaces…but yes, are the reason why we need so many healthy young adults in the pools as well. Here is a study outlining the needs report
This report from the Urban Institute is a look at how 10 states considered the economic and fiscal trade offs if they were to expand their Medicaid programs. The report found that in each state where relatively comprehensive analyses of costs and fiscal gains were conducted, the net result showed that, on balance, Medicaid expansion would yield state fiscal advantages.
The Department of Health and Social Services issued some encouraging news today for consumers about savings associated with health insurance. “Today, the Department of Health and Human Services (HHS) announces that nationwide, 77.8 million consumers saved $3.4 billion up front on their premiums as insurance companies operated more efficiently. Additionally, consumers nationwide will save $500 million in rebates, with 8.5 million enrollees due to receive an average rebate of around $100 per family.”
This is related to the 80/20 rule where insurance companies have to spend 80% of every dollar collected in premiums on direct patient care. If they do not, the difference is given back to the consumers as either rebates or compensation in better future benefits.
Evidence continues to grow that the American lifestyle is particularly damaging to the health of Hispanic immigrants. This New York Times article provides a nice summary.
View this information sheet to see the role envisioned by DHHS for the various types of assisters.
This report analyzes the loss to the federal budget by allowing this practice. This practice was initiated because it encouraged employers to pay for employees’ insurance plans. Health insurance has, since World War II, been an important recruiting tool. Businesses with better health benefits could choose from a larger more skilled employee pool. It’s been a trade off between higher salaries and more extensive benefit packages. ACA now requires taxing some of the insurance plans offered. These are now referred to as “Cadillac” plans with the intonation that these plans are perhaps somewhat lavish and therefore not really necessary. Those who have come to expect that type of complete coverage of their health care needs don’t think the plans are lavish but rather customary and essential. That’s not the debate here. This is just showing by how much the general federal deficit could be reduced if the practice of allowing employers to offer such extensive plans and claim tax exemptions for them were eliminated. Policy analysts have oft referred to these tax exempt plans as money lost to the federal coffers.
Spending slowdown: If the current slowdown in healthcare spending persists, the government might save roughly $770 billion over the next decade, according to Harvard University Professor David Cutler. He writes in the latest issue of Health Affairs that the slowdown in health spending was caused in part by the recession, and also by slower advances in medical technology and the growth of health plans that shift more costs to consumers.
“If these trends continue during 2013–22, public-sector health care spending will be as much as $770 billion less than predicted. Such lower levels of spending would have an enormous impact on the US economy and on government and household finances,” Cutler wrote.
Read his study here.
In this blog we discuss the issues with health reform.