New HC rates with Obamacare

[Mulligan]

I got pulled into group retirement (called SS) when I think I could do a much better job with individual retirement using that 14% of my income. Ask me if I am upset in 20 years or so.

That happen in 2010 to you, like it did me? Well hopefully it works out for both of us...

 

[modhatter]

All insurance involves everyone paying, and some using. To call that a subsidy is an effort to shift the attention and portray it a certain way.

The insurance companies segment and price the individual market differently than the large group market. They currently define group by gender, age, region, state, and health condition, break them down into hundreds of segments, and price each differently. This [-]is a failed model because it[/-] excludes so many and is punitive on some that move between sub-group.

The large group market defines groups differently, with fewer segments and far less granularity. This market works much more smoothly for sponsors and users. The ACA is attempting to make the individual market work more like large group insurance, where the primary driver of difference in premium is coverage.

Individual group coverage will continue to define sub-groups with more segmentation. Age is still a factor, as is region. It is still critical shift, however, away from a model where the key driver of price is exclusion.

While many measures have already been fully implemented, it is fair to say that one key test is new enrollment. The key to success in not getting more young people to enroll, it is getting all people to enroll, and making the individual marketplaces more like a large group market.

Extremely well put, and so true. Me thinks people who have been fortunate enough to have insurance provided for them through their employer under a large group policy, are blinded by the fact that not everyone in society has enjoyed such protection.

The ACA attempts to some extent to level this playing field. For you still employed and working for a large corporation, I don't think you would say that it is "unfair" for the young people in your company to be subsidizing you "older folks" would you? Is it really different because the company is paying for this "pooled" policy and not you individually?

Nor, have people who get cancer or develop a serious heart condition protected by large company group policies felt the gut wrenching fear of having their insurance rates raised every year until they just can't afford it any more and are foced to drop it , knowing full well you will not be able to find another insurance company to cover you from here on out.

The facts are simple.
1. Young people don't get sick as much as older people do. Our parts wear out as we age.
2. Young people eventually get old, and the new crop of young people coming in will be helping them.
3. Everyone in the same pot makes covering everyone more manageable and feasible.

 

[2B]

I got pulled into group retirement (called SS) when I think I could do a much better job with individual retirement using that 14% of my income. Ask me if I am upset in 20 years or so.

One thing we can all be sure of here is that we'd actually have some of the money left in our retirement plan. We wouldn't have spent it and written IOUs to ourselves.

 

[daylatedollarshort]

Extremely well put, and so true. Me thinks people who have been fortunate enough to have insurance provided for them through their employer under a large group policy, are blinded by the fact that not everyone in society has enjoyed such protection.

Or they are blinded by the fact the few people are immune over the course of the rest of their lives, to job loss, developing a pre-existing condition or a major financial setback in their own lives where they may need the benefits of the ACA.

 

[samclem]

Extremely well put, and so true. Me thinks people who have been fortunate enough to have insurance provided for them through their employer . . .

I suppose that's one way of putting it, if we want to use the passive voice regarding how compensation "happens."

Or they are blinded by the fact the few people are immune over the course of the rest of their lives, to job loss, developing a pre-existing condition or a major financial setback in their own lives where they may need the benefits of the ACA.

While we're making broad generalizations, can we acknowledge that those who don't/won't pay the market rate for their health coverage are, maybe, vociferous in their support of the ACA because they are darn happy to have a law that makes other people pay for them?
Strictly speaking, (and not in reference to daylate's comment above) neither the ACA nor any other law provides "benefits" (if we're talking about goods and services). All those goods and services come from other people.

 

[daylatedollarshort]

I won't reply because it will get the thread shut down, if it isn't too late. I will just post a link to this map on what countries have universal care -

Here's a Map of the Countries That Provide Universal Health Care (America's Still Not on It) - Max Fisher - The Atlantic

 

[M Paquette]

I suppose that's one way of putting it, if we want to use the passive voice regarding how compensation "happens." While we're making broad generalizations, can we acknowledge that those who don't/won't pay the market rate for their health coverage are, maybe, vociferous in their support of the ACA because they are darn happy to have a law that makes other people pay for them?

Maybe for the tiny fraction of possible customers who actually know this. There aren't many of them, from the discussions I've been in.

I'm just really happy that I can get guaranteed issue of catastrophic coverage. No, the old state high risk pool with its limited size and long waitlist didn't exactly fill this need.

The guaranteed issue plans appear to be market rate. At least somehow the insurance companies seem to be able to offer coverage for a broad pool of people, while still making close to a 20% profit.

 

[samclem]

I'm just really happy that I can get guaranteed issue of catastrophic coverage.

We'll have achieved something important when the ACA (or its successor) morphs to allow purchase of "pure" health insurance: catastrophic, high deductible plans.

 

[pb4uski]

....While we're making broad generalizations, can we acknowledge that those who don't/won't pay the market rate for their health coverage are, maybe, vociferous in their support of the ACA because they are darn happy to have a law that makes other people pay for them?......

I would not agree - IMO it is more making health insurance more affordable - but not a free ride as your "other people pay for them" quip infers. Even with subsidy, a family at 300-400% FPL will still be paying 9.5% of their income for health insurance plus on top of that, deductibles, co-pays and co-insurance if they need health care services. From 100% FPL to 300% FPL they will pay 2-9.5% for health insurance, plus plus deductibles, co-pays and co-insurance if they need health care services.

IMO, those costs are still very significant compared to employer provided/subsidized health insurance as a % of O-MAGI - so it just a move in the right direction for people who can't get health insurance through work to be closer to those who can.

I would have liked to see them totally divorce health insurance from employment but still stay with private health insurance - but the political courage wasn't there.

 

[samclem]

I would not agree - IMO it is more making health insurance more affordable - but not a free ride as your "other people pay for them" quip infers.

I didn't say or infer "a free ride." For each of us, based on our age and health, there is an expected cost for future medical care. Under the ACA, those in the individual market with very high expected future costs are getting "other people to pay" these costs. That's all I meant, and it is 100% accurate. We can and should hash out whether this is a good policy or not, but I don't think there's any dispute about what is being done.
Those who "win" when a law takes resources from others and gives it to them are likely to support that law. The "payers" are likely to take a different view. When the self-righteous talk starts (either side), it can be hard to determine how much is heartfelt and how much is pure self interest.

 

[modhatter]

It is early in the game Samclem. Give it a little time. Insurance companies are holding back right now to "wait and see". If it works out other policies should be added and their are catastrophic plans for those under 30, and the bronze plan isn't that far off if that is the kind of coverage you like.

And as for your reference to bias in the above statement. Of course your correct. That was my point. Until you have had the opportunity to walk in another man's shoes, you may not experience what they have.

However, it is not only those who will "benefit" from the new law who support it. There are countless VERY wealthy people who do not and will not need to purchase into an exchange that openly support it with all their hearts, as they seem to recognize the inequity and cruelty of the current system.

Once you figure out a better way to insure "everyone" access to basic health care that doesn't cost the healthy or the young more than they need to while they are healthy and young, please present your plan. Just keep in mind again that those young people will soon turn into old people and those now healthy people will eventually get sick.

 

[2B]

IMO, those costs are still very significant compared to employer provided/subsidized health insurance as a % of O-MAGI - so it just a move in the right direction for people who can't get health insurance through work to be closer to those who can.

Employer provided health insurance is part of the compensation package. My employer chips in $10,000 every year for my and DWs HI. It's a high deducible plan where the employer gets to deduct this cost from their (hoped for) profits and I get to deduct my portion since I pay via a HSA. Single people cost my employer less and the "breeders" with rugrats cost more. Every once in a while someone gets something serious that really runs up the tab. Even so, everything can be tax deductible. I like to live under the illusion that if my employer did not provide HI I would get this redirected value as direct pay but then I would not get tax deductible HI.

If a job was only worth minimum wage, there is not an incentive to pay for that employees health care. These are contracted. As indirect employees no $10,000 is contributed for their health care. They are driven into the exchanges.

I have had more than enough contact with the moderators on the good and needs improvement aspects of the ACA and I seek no additional contact. I only wish to point out a key difference that still remains between the group and individual HI markets and how it impacts affordability.

 

[2B]

It is early in the game Samclem. Give it a little time. Insurance companies are holding back right now to "wait and see". If it works out other policies should be added and their are catastrophic plans for those under 30, and the bronze plan isn't that far off if that is the kind of coverage you like.

The plans that are in the exchanges have to meet in bronze, silver.... details. All HI will have to have "essential coverages" met. Samclem will still have to pay for maternity care but he could get his sex change operation done on the insurance plan of his choice.

I believe there is some flexibililty of what can be offered as an individual policy off the government exchange. The "essential coverages" are not an option and will be included no matter what the customer wants.

The "essential coverages" also impact employer provided group plans. Some plans are not significantly affected by this but some are seriously impacted.

 

[donheff]

I didn't say or infer "a free ride." For each of us, based on our age and health, there is an expected cost for future medical care. Under the ACA, those in the individual market with very high expected future costs are getting "other people to pay" these costs. That's all I meant, and it is 100% accurate. We can and should hash out whether this is a good policy or not, but I don't think there's any dispute about what is being done.
Those who "win" when a law takes resources from others and gives it to them are likely to support that law. The "payers" are likely to take a different view. When the self-righteous talk starts (either side), it can be hard to determine how much is heartfelt and how much is pure self interest.

This same argument applies to group employer policies. I exercise regularly, keep my weight down, and stopped taking illicit drugs decades ago. My use of health care services (and my family's) was minimal through my entire career yet I paid the same as my fellow coworkers with diabetes, emphysema from smoking, whatever. But the reality is each of us can go from a giver to a taker in the blink of an eye. I saw it happen with some of my relatives. Some sort of universal coverage is key to protect us all, whether it is a compromise kludge like the one we pasted together, a single payer system like many countries use, or some other approach.

 

[travelover]

This same argument applies to group employer policies.........

And of course, the health care insurance is provided to you tax free, whereas others have to buy healthcare insurance with after tax money.

 

[ChiliPepr]

Well, there's lots of reasons to move from MA, but I stay for the mild winters, low taxes, nice people, courteous drivers and balanced political structure.

Exact same reasons I stay!

 

[pb4uski]

I didn't say or infer "a free ride." For each of us, based on our age and health, there is an expected cost for future medical care. Under the ACA, those in the individual market with very high expected future costs are getting "other people to pay" these costs. That's all I meant, and it is 100% accurate. We can and should hash out whether this is a good policy or not, but I don't think there's any dispute about what is being done.
Those who "win" when a law takes resources from others and gives it to them are likely to support that law. The "payers" are likely to take a different view. When the self-righteous talk starts (either side), it can be hard to determine how much is heartfelt and how much is pure self interest.

You didn't say "free ride" (and I didn't suggest that your did). And you say you didn't infer it (or intend to anyway) which is fine by me - thanks for the clarification.

 

[ERhoosier]

Something I just learned today that might help some on here- it surely will help me- is that COBRA has a 60 day GRACE period. As I am taking ER on December 1, 2013 I thought I was going to have to pay the exorbitant COBRA rate until I could buy one of the new policies effective January 1. But I do not. I can just start shopping for a new policy that will go I into effect by February 1, 2014 and I do not have to pay a dime unless we make a claim in those 60 days. At that point I can say, oops, I meant to have my COBRA coverage paid up, I guess I forgot and it goes into effect. It turns out this feature of COBRA costs companies huge amounts of $$ because most people who take COBRA are likely to make a claim. To make up for this, Insurance companies charge more money for the policies. With the ACA, most people will find the exchanges superior to paying COBRA, thus creating a break for the companies currently having to pay extra to cover the ex employees under these plans.

Swapping COBRA for Obamacare expected to be windfall for big business : Lifestyles

Thanks for the link. Not sure I completely agree with the analysis, but interesting reading.

I would not wait to cut things close with COBRA deadline. Most firms seem to take 2+wks after termination to send you formal notification & forms/procedures. I've read many horror stories about how inept COBRA benefits managers can be. It's best to leave yourself a generous time window in case your application &/or payments get 'misplaced' long enough to threaten your COBRA status. And networks will not pay claims made within that 60d COBRA window until you have paid up your premiums, so providers may hold you fully responsible for all costs up front then expect you to fight for reimbursement from carrier. IIRC, upon election of COBRA you must pay all premiums due starting upon the date of employment termination. And AIUI, if you leave COBRA for any reason you cannot go back. So, for example, if you ER in Dec 13, then decide to get an Exchange policy Jan 14, you cannot quit that Exchange policy & go back to COBRA even if you do have a "qualifying event" allowing change of HI outside normal OE period. I would be sure any Exchange policy's provider network meets your needs, and be prepared to stick with that Exchange policy if premium rises dramatically for 2015 (not sayin' it will).
BTW- Ins carriers cannot raise overall rates (employer plus employee portions) for COBRA policies since they are at the same premium cost your ex-employer paid, plus a small (1-2%) admin fee. Of course, the increase in your cost for that HI will depend on how much (or little) your employer was contributing to your premiums while you were w@rking. After your 18mo of COBRA, rates can go up a lot upon conversion to an individual policy (if it's offered at all by the carrier).

 

[scrinch]

This same argument applies to group employer policies. I exercise regularly, keep my weight down, and stopped taking illicit drugs decades ago. My use of health care services (and my family's) was minimal through my entire career yet I paid the same as my fellow coworkers with diabetes, emphysema from smoking, whatever. But the reality is each of us can go from a giver to a taker in the blink of an eye. I saw it happen with some of my relatives. Some sort of universal coverage is key to protect us all, whether it is a compromise kludge like the one we pasted together, a single payer system like many countries use, or some other approach.

Exactly. Any kind of insurance results in grouping people and pooling their risk. By definition there will be winners and losers, but we don't know who they will be until afterwards. A 26-year-old can have $1 million/yr health costs while a 96-year-old may have none. So we are talking about how we make the groups that pool risk and share costs, not whether to make the groups. The ACA is just making the groups broader, with fewer exclusions, and in the new groups who pays more than their own cost and who pays less will be different, but not in a fundamental way. The only truly fair (to each individual) way to allocate costs is for everyone to pay their own way, but I think we've decided that pooling risk and sharing costs is something that our society would like to do. Something like...let's all share the cost of paying for cancer treatment since we all share the risk of developing the disease and needing that treatment.

 

[photoguy]

Exactly. Any kind of insurance results in grouping people and pooling their risk. By definition there will be winners and losers, but we don't know who they will be until afterwards.

While there will be winners & losers in terms of the premiums paid vs actual payouts, one way everybody wins is through a reduction of uncertainty.

 

[meierlde]

While there will be winners & losers in terms of the premiums paid vs actual payouts, one way everybody wins is through a reduction of uncertainty.

Actually that is the whole point of insurance, to reduce uncertainty, or to use a finance term to hedge ones risk. I have read that at least some insurance started with the desire that families of Scottish Clergy be taken care of in case they died. From this came the Scottish Widows founded in 1815. Also the fire insurance companies started by Ben Franklin in the US, pay something to hedge the risk of a fire.