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PPACA, Obamacare and General Comments
Old 05-09-2013, 05:39 PM   #1
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PPACA, Obamacare and General Comments

This is probably a stupid question, but this whole Obamacare thing-a-majig basically replaces buying a policy on the open market like you might do at EHealthinsurance.com, correct? If you have access to HI thru your employer, this doesn't directly affect you. Is that right?
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It's a "Cliff Falloff" Structure!!!!
Old 05-09-2013, 05:56 PM   #2
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It's a "Cliff Falloff" Structure!!!!

I note that once my age 60+ family of two has $60,000 of AGI, (up from $59,000), my net monthly insurance premium LEAPS from $450 to $1,600! We are not working, but we will have realized capital gains this year + my wife's IRA withdrawls + Dividends, almost certainly taking us over $60,000 AGI. So, for a few thousand of extra AGI, I will suffer $13,000 per year in additional premium cost out-of-pocket. I didn't know that $60,000 was "wealthy". Also, I note that my current insurance premium (in NC) is $1,000/month, not the $1,600 estimated in the model. Welcome to eating dog food under Obamacare!
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PPACA, Obamacare and General Comments
Old 05-09-2013, 06:01 PM   #3
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PPACA, Obamacare and General Comments

Just a thread for folks to post questions and comments that are not specific to any of the other healthcare threads.
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Old 05-09-2013, 06:05 PM   #4
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Originally Posted by utrecht View Post
This is probably a stupid question, but this whole Obamacare thing-a-majig basically replaces buying a policy on the open market like you might do at EHealthinsurance.com, correct? If you have access to HI thru your employer, this doesn't directly affect you. Is that right?
Not sure ehealthinsurance will still be selling policies. An employer provided policy must meet eligibility criteria as well, if not, the employee can use the state health exchange.
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Old 05-09-2013, 06:06 PM   #5
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To the OP -- sort of, but not exactly. There are more moving parts in some ways and less moving parts in others: more moving parts in terms of navigating through subsidies, and less in terms of not dealing with underwriting or pre-existing condition concerns.

As with many new laws that represent massive changes to the social contract, it will probably take a few years to figure out what works, what doesn't, and what is being abused to figure out a way to improve (in the eyes of most folks) the original laws.
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Old 05-09-2013, 06:18 PM   #6
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Originally Posted by DougViages View Post
I note that once my age 60+ family of two has $60,000 of AGI, (up from $59,000), my net monthly insurance premium LEAPS from $450 to $1,600! We are not working, but we will have realized capital gains this year + my wife's IRA withdrawls + Dividends, almost certainly taking us over $60,000 AGI. So, for a few thousand of extra AGI, I will suffer $13,000 per year in additional premium cost out-of-pocket. I didn't know that $60,000 was "wealthy". Also, I note that my current insurance premium (in NC) is $1,000/month, not the $1,600 estimated in the model. Welcome to eating dog food under Obamacare!
In the first place, no one really knows what the actual premiums will be. I think a lot of these models are based upon estimates that may or may not be correct in the end. I tend to think that the current Massachusetts actual premiums will be closer to what premiums will be under the PPACA. I did check those and they were far lower than what the models seem to predict.

Second, people need to consider total cost of healthcare. That is, a lower premium with more co-pays and higher deductible may have a higher overall cost than a higher premium with a lower deductible and less out of pocket.

Third - As I understand subsidies while they will base the initial estimate for next year on a prior year's income, if your income next year would qualify you for a subsidy then that will be sorted out when you file your tax return. I imagine a lot of people will use that to put income, for example, into this year so that next year they will be within the subsidy amount.

(That said, I agree that the sharp cliff is not good and I would prefer to see a phase out that was more of a gentle path)
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Old 05-09-2013, 06:20 PM   #7
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To the OP -- sort of, but not exactly. There are more moving parts in some ways and less moving parts in others: more moving parts in terms of navigating through subsidies, and less in terms of not dealing with underwriting or pre-existing condition concerns.

As with many new laws that represent massive changes to the social contract, it will probably take a few years to figure out what works, what doesn't, and what is being abused to figure out a way to improve (in the eyes of most folks) the original laws.
I think this is especially true of the fiscal cliff. It is painful and in everyone's face. No idea how they will change it, but there will be lots of pressure to do something.
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Old 05-18-2013, 12:32 PM   #8
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A positive result! It turns out that when similar insurance plans can be compared side by side, that higher priced plans have an incentive to try and compete on price! This interesting development happened on the new Oregon health insurance exchange.


http://www.oregonlive.com/health/ind...econsider.html

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On Thursday, a comparison of proposed 2014 health premiums became public online, causing two insurers to request do-overs to lower their rates even before the state determines whether they're justified.

The unusual development was sparked by a comparison that used to be impossible because plan benefits varied so widely. But under the federal reforms that take effect Jan. 1, health insurance is mandated and every insurer must offer certain standard plans.
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Old 05-18-2013, 02:56 PM   #9
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Originally Posted by DougViages View Post
I note that once my age 60+ family of two has $60,000 of AGI, (up from $59,000), my net monthly insurance premium LEAPS from $450 to $1,600! We are not working, but we will have realized capital gains this year + my wife's IRA withdrawls + Dividends, almost certainly taking us over $60,000 AGI. So, for a few thousand of extra AGI, I will suffer $13,000 per year in additional premium cost out-of-pocket. I didn't know that $60,000 was "wealthy". Also, I note that my current insurance premium (in NC) is $1,000/month, not the $1,600 estimated in the model. Welcome to eating dog food under Obamacare!
If you're now paying $1,000 and you pay $1,600 next year shouldn't the "additional premium" be $7,200 a year rather than $13,000? Not that $7,200 a year is inconsequential, but I'm just trying to understand.

What really counts at the end of the day is your 2014 income compared to 400% FPL because that is what will be used to true-up your Obamacare subsidy when you file your 2014 tax return in early 2015. Can you manage your 2014 capital gains, IRA withdrawals and dividends to keep your O-MAGI below 400% FPL? The projected 400% FPL for 2014 is ~$62,000-$62,500.
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Old 05-18-2013, 03:09 PM   #10
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Maybe not relevant to this conversation but remember if you itemize on your taxes, the medical expense deduction threshold goes from the 7.5% of AGI to 10%.
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Old 05-18-2013, 03:48 PM   #11
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A positive result! It turns out that when similar insurance plans can be compared side by side, that higher priced plans have an incentive to try and compete on price! This interesting development happened on the new Oregon health insurance exchange.
Over the past 5 years I have done many policy comparisons for the folks kind enough to extend policy access to me. It is impossible to do effective side-by-side cost analysis because of the different levels of coverage and cost sharing. Now, between actuarial value classification, essential items mandates and a few other new regulations, comparing policies should be much simpler, and choice easier. That's good.
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Old 05-18-2013, 05:53 PM   #12
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Originally Posted by DougViages View Post
I note that once my age 60+ family of two has $60,000 of AGI, (up from $59,000), my net monthly insurance premium LEAPS from $450 to $1,600! We are not working, but we will have realized capital gains this year + my wife's IRA withdrawls + Dividends, almost certainly taking us over $60,000 AGI. So, for a few thousand of extra AGI, I will suffer $13,000 per year in additional premium cost out-of-pocket. I didn't know that $60,000 was "wealthy". Also, I note that my current insurance premium (in NC) is $1,000/month, not the $1,600 estimated in the model. Welcome to eating dog food under Obamacare!
I'm not sure I understand your situation. At this point, do any of us who purchase individual health insurance know what our premiums are going to be next year? How did you find our your premium was going from $450 to $1600? I jumped up and down and stomped my feet and shook my fists (via email) but I could NOT get Humana to give me any indication of how our current policy (HDHP with HSA, max deductible allowed) will fit into the new structure.

We currently pay about $400 per month for both of us. Our subsidy will depend on our income but I didn't think our income determined or was related in any way to the amount of our premium.
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Old 05-18-2013, 10:57 PM   #13
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........ At this point, do any of us who purchase individual health insurance know what our premiums are going to be next year? ...........
Yes, $742.38 per month for two for a HDHP bronze plan.

Vs ~$629 a month currently for a HDHP.

http://www.dfr.vermont.gov/sites/def...HP%20rates.pdf
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Old 05-19-2013, 04:31 AM   #14
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How did you find our your premium was going from $450 to $1600?
I think a lot of folks making such comparisons compare this year with Option A to next year with Option B, instead of comparing this year with Option A to next year with Option A (to determine sector-related inflation) and then using that to normalize a comparison of next year Option A to next year Option B. It is rather easy to make an invalid comparison and rather complicated to make a valid one.

As Michael indicated, though, starting with 2015, it'll finally be much easier to do so.
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Old 05-19-2013, 05:41 AM   #15
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Is there somewhere the plan types are described (bronze silver gold)?
TJ
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Old 05-19-2013, 06:01 AM   #16
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http://kff.org/interactive/subsidy-calculator/


Not sure if anyone has used or posted this link yet. This is a calculator that you can plug in your age income and how many family members. It gives an estimate of your cost and subsidy.
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Old 05-19-2013, 06:09 AM   #17
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Is there somewhere the plan types are described (bronze silver gold)?
TJ
This KFF paper should help http://kaiserfamilyfoundation.files....13/01/8177.pdf. The levels (silver, gold) refer to actuarial value and cost sharing. Of the expected average cost a policyholder will incur in a year, and how much will be paid by the insurer. Bronze has an actuarial, value of 60%, silver 70%, gold 80%, and platinum 90%.
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Old 05-19-2013, 08:07 AM   #18
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This KFF paper should help http://kaiserfamilyfoundation.files....13/01/8177.pdf. The levels (silver, gold) refer to actuarial value and cost sharing. Of the expected average cost a policyholder will incur in a year, and how much will be paid by the insurer. Bronze has an actuarial, value of 60%, silver 70%, gold 80%, and platinum 90%.
I tried in several emails to get Humana to tell me the actuarial value of our current policy and they gave me some blah, blah, blah and wouldn't respond directly and wouldn't tell me when they could give me an answer.
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Old 05-19-2013, 08:12 AM   #19
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Subsidy Calculator | The Henry J. Kaiser Family Foundation


Not sure if anyone has used or posted this link yet. This is a calculator that you can plug in your age income and how many family members. It gives an estimate of your cost and subsidy.
This calculator is more flexible than one posted previously. Thanks.

Went to the home page of the site. Tons of info!
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Old 05-19-2013, 08:17 AM   #20
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I tried in several emails to get Humana to tell me the actuarial value of our current policy and they gave me some blah, blah, blah and wouldn't respond directly and wouldn't tell me when they could give me an answer.
They may never give it to you, but beginning next Jan the new policies they sell on the state insurance exchanges must have that information.
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