Second installment on ACA for those that like to read tea leaves...

[rodi]

Just a reminder. This is all speculation. There is no active legislation in front of the congress or the President (Elect). While it is interesting to speculate on political possibilities - it is better discussed on message boards with a more political focus.

 

[LARS]

As an aside, I am blown away by the huge $ spread mentioned in this thread between states on cost of healthcare.

 

[travelover]

As an aside, I am blown away by the huge $ spread mentioned in this thread between states on cost of healthcare.

As I've said before, it amazes me how little analysis and commonly accepted facts there are available for something that consumes almost 20% of the largest economy on earth. We seem to know more about the mating habits of the kumquat beetle.

 

[explanade]

As I understand Price's plan:

1. Yes, credits are age based. $3000 for 50+ though isn't a lot. His plan does not cap at all the premiums that can be charged. Currently, I think older people can only be charged 3x what younger one's are charged. Some proposals have suggested a 5x rate. Price's plan puts no limit on what can be charged.

2. His proposal on pre-existing conditions allows people to be covered at standard rates if they maintain continuous coverage. If there is a gap in coverage (example: person loses job and can't afford coverage for awhile) then they have to pay 150% of standard rate. They get back to standard rate after 18 months of continuous coverage. That is actually not that bad, but the real problem is that cost of coverage for older people is likely to be very high.

For example, I read an article where someone commented that on the marketplace in their locale the cheapest bronze plan for someone over 50 was about $8500 a year. I get private retiree insurance which is partially subsidized by DH's former employer. It covers me and our 2 young adult children -- the premium is over $18000 a year, most of which is for me.

(Note that $8500 premium for similar coverage would likely be far more expensive under Price's plan because now insurers are constrained to 3 times what young people pay. Under his plan, the sky is the limit).

3. There are no mandated requirements for what has to be covered. That can potentially result in lower premiums for policies that cover less. On the other hand, there may not be policies available with the coverage you want (or they may be priced extremely high).

4. Medicaid expansion is repealed without any replacement for it.

5. The employer tax exclusion for employer provided plans is lowered.

The overall gist of his plan is that it may save money for young, healthy people who like plans with lesser coverage and lower premiums.

For older people who may have significant health care needs, premiums would be unregulated with only a $3000 credit provided. For someone in that age bracket, I think it would significantly increase my health insurance budget.

6. Note that going on Medicare may not help later on. Price is an advocate of privatizing Medicare and providing only a voucher that would cover part of the cost. He has indicated that Congress will get to work on the Medicare part in about 6 months.

Also no individual mandate so it doesn't matter what the plan is like for young, healthy people.

High-risk state pools currently cover only about 200k people. So that wouldn't appear to be enough depending on how broadly pre-existing conditions are defined.

 

[Senator]

As I've said before, it amazes me how little analysis and commonly accepted facts there are available for something that consumes almost 20% of the largest economy on earth. We seem to know more about the mating habits of the kumquat beetle.

If healthcare is 20% of the economy, would that imply that in a perfect world everyone would pay 20% of their income on healthcare?

Or is my analysis incorrect?

 

[RetireAge50]

I don't know what healthcare is really. Never had to pay for it and rarely used it. Maybe I'm not typical.
I think a lot of people don't pay attention as it is paid for by their employer or the government.

 

[daylatedollarshort]

So how would this plan work for people of low to moderate income in places like Alaska (where we are thinking of moving for a few years)?

The policy for a non smoking couple in their mid/late 40s is $27,000+ a year there.

I don't even want to look at how much a policy would be there for someone in their late 50s.

$3000 would not go very far?

Our unsubsidized premiums are currently $1.5K for a couple in their 50s in California, or 18K a year. California has really been advertising Covered California on TV and everywhere so I think that helps increase the size of the risk pool.

According to the chart in the article below Alaska is on the high end for health insurance costs so if you can live anywhere maybe that isn't your best choice of states?

10 Best and Worst States for Health Insurance Costs | The Huffington Post

 

[Big_Hitter]

Our unsubsidized premiums are currently $1.5K for a couple in their 50s in California, or 18K a year. California has really been advertising Covered California on TV and everywhere so I think that helps increase the size of the risk pool.

that's with the 3/1 rule and individual/employer mandate correct?

if those come off the table, I'm not sure $6K a year will go very far, js

 

[daylatedollarshort]

In the previous thread that was combined here sengsational wrote, "No need to move. Go without insurance, go to the ER if you need to, and take a trip if your health issue isn't an emergency. You can self-insure since the prices abroad are reasonable. And you simply don't pay for the domestic ER (at the insane 'charge master' rates) unless they reduce the charges to the Medicare level pricing."

If I was in a coma from a bad car accident or had my appendix burst, I don't think that would be a good time to have to travel to Mexico and arrange housing and medical care. Since the choices for affordable medical care are pretty much every other country in the developed world except the U.S., if we can't get insurance we will most likely rent out the house and move until Medicare age (unless that gets risky as well) rather than stay here and have to go back to work full time or risk medical bankruptcy. We moved to where we live now for jobs we no longer have so it is not like we would be moving away from childhood hometowns and extended family. In our case we would probably move to closer to extended family and much cheaper housing costs as well as affordable medical care.

 

[daylatedollarshort]

that's with the 3/1 rule and individual/employer mandate correct?

if those come off the table, I'm not sure $6K a year will go very far, js

Yes, I know that is why I put currently. At 5 to 1 we would go to $2.5K a month plus current out of pocket max I think is $14K. We're close enough to Medicare age now we would just absorb that cost but move if we can't get insurance at all or only insurance with some low annual or lifetime cap. We know someone who just had over $1M in medical bills over a relatively short period of time so for us going over that amount doesn't seem like a remote possibility.

We're just taking a hope for the best but plan for the worst approach this year. If the worst case is moving a resort city in Mexico or Spain for several years, then I guess that falls under the category of first world problems.

 

[Big_Hitter]

We're just taking a hope for the best but plan for the worst approach this year. If the worst case is moving a resort city in Mexico or Spain for several years, then I guess that falls under the category of first world problems.

agreed - DW kind of freaking out about this stuff

 

[travelover]

If healthcare is 20% of the economy, would that imply that in a perfect world everyone would pay 20% of their income on healthcare?

Or is my analysis incorrect?

Not sure what you are getting at, but this might clarify. The actual number is about 17 to 18% .

According to the World Health Organization (WHO), the United States spent more on health care per capita ($8,608), and more on health care as percentage of its GDP (17.2%),

https://en.wikipedia.org/wiki/Health_care_in_the_United_States

 

[Senator]

Not sure what you are getting at, but this might clarify. The actual number is about 17 to 18% .


https://en.wikipedia.org/wiki/Health_care_in_the_United_States

I was inferring that if you pay less than the 20% of your income on Health Care, you are getting a bargain.

 

[MRG]

With as much criticism as ACA has received don't know how a lesser and possibly more expensive replacement will be accepted. To me version 2 of anything should be better than V1, if not it's a failure.

Now there's a lot of folks who will be happy they don't have to have insurance anymore so maybe a percentage of people will be happier, till they're sick.

 

[Senator]

With as much criticism as ACA has received don't know how a lesser and possibly more expensive replacement will be accepted. To me version 2 of anything should be better than V1, if not it's a failure.

Now there's a lot of folks who will be happy they don't have to have insurance anymore so maybe a percentage of people will be happier, till they're sick.

I agree. I would think additional competition would do a lot to offset the higher Health Care fees.

 

[daylatedollarshort]

agreed - DW kind of freaking out about this stuff

I snapped out of freaking out after I talked to someone with no retirement savings, and realized I was incredibly fortunate even in our "worst case" scenario.

 

[Big_Hitter]

DW is a worrier^12 - one reason I'm not yet FIRED

 

[Fermion]

Someone making $40,000 a year, 20% of their income is $8,000. That is actually not much money for insurance + max out of pocket for a couple.

The example I gave in Alaska at $27,000 a year would be 67.5% of your income for insurance...if you used no services!

You get into the $100k income range and 20% isn't quite as rough.

 

[NW-Bound]

According to the World Health Organization (WHO), the United States spent more on health care per capita ($8,608), and more on health care as percentage of its GDP (17.2%)...

If that is the average over the entire population, then geezers cost a whole lot more than $8.6K each. In 2010, people over 65 make up 13 percent of the population. People under 50 generally cost little in healthcare.

I guess that's why our premium is $2K/month for a dingy Bronze plan with $11K deductible. I've gotta work on the MAGI thing.

 

[explanade]

We're just taking a hope for the best but plan for the worst approach this year. If the worst case is moving a resort city in Mexico or Spain for several years, then I guess that falls under the category of first world problems.

You can't buy into any of the govt. health care systems in Europe can you?

Several EU countries might give you a retirement visa but they're not going to pay for your health care?

Unless some of these countries have private insurance which is more reasonable than anything in the US?

 

[daylatedollarshort]

You can't buy into any of the govt. health care systems in Europe can you?

Several EU countries might give you a retirement visa but they're not going to pay for your health care?

Unless some of these countries have private insurance which is more reasonable than anything in the US?

We can live in the E.U. (dual citizenship), and whether health insurance is free or simply more affordable depends on the country and factors like residency status and length of residency. Alternately, lots of U.S. residents retire to places like Mexico and pay for private insurance, which from what I've read and our members here report, is very affordable. I'm not looking for free health care. We would just move if we can't get any health insurance without lifetime or annual caps here due to pre-existing conditions. I don't want to be in a position of risking our life savings on a medical bankruptcy when I don't think that would even be an issue in any other developed country in the world.

See 21 graphs that show that U.S. healthcare costs are ludicious

"This is the fundamental fact of American health care: We pay much, much more than other countries do for the exact same things."

 

[ShokWaveRider]

How would tax credits work for those of us who pay really low taxes. $3000 is not going to help much if Healthcare costs $3k pm. Currently We get $1340 pm Subsidy. $3k credit is a no starter for me and DW. It would force us to go back to the ranks of the uninsured.

 

[Alan]

How would tax credits work for those of us who pay really low taxes. $3000 is not going to help much if Healthcare costs $3k pm. Currently We get $1340 pm Subsidy. $3k credit is a no starter for me and DW. It would force us to go back to the ranks of the uninsured.

There are 2 types of tax credits. Credits that only reduce taxes to zero and those that actually would produce a payment back to the individual.

e.g. your tax return shows you paid $1,500 in taxes. A credit for buying a new energy efficient boiler of $3k would reduce your taxes to zero. I expect a healthcare tax credit of $3k would mean a tax refund of $1,500

https://www.irs.gov/credits-deductions/individuals

There are two types of tax credits:
A nonrefundable tax credit means you get a refund only up to the amount you owe for taxes.
A refundable tax credit means you get a refund, even if it is more than what you owe.

 

[Katsmeow]

In the previous thread that was combined here sengsational wrote, "No need to move. Go without insurance, go to the ER if you need to, and take a trip if your health issue isn't an emergency. You can self-insure since the prices abroad are reasonable. And you simply don't pay for the domestic ER (at the insane 'charge master' rates) unless they reduce the charges to the Medicare level pricing."

If I was in a coma from a bad car accident or had my appendix burst, I don't think that would be a good time to have to travel to Mexico and arrange housing and medical care. Since the choices for affordable medical care are pretty much every other country in the developed world except the U.S., if we can't get insurance we will most likely rent out the house and move until Medicare age (unless that gets risky as well) rather than stay here and have to go back to work full time or risk medical bankruptcy.

I think there are 2 main problems with the language you quoted. First, simply not paying for the insane ER prices doesn't solve the problem. Hospitals can and do sue for balances due particularly if someone may have money to pay it. That can lead to a medical bankruptcy and is not something I want to expose myself too either.

The other thing that I think many no insurance people miss is that many things that require expensive care are not the type of thing that get treated in the ER. The ER is not going to pay for your expensive chemotherapy for example.

 

[Suppertime]

A bit off topic but this idea of letting people buy health insurance across state lines gets tossed around a lot, really annoys me.

Offering insurance in a state requires the hard work of negotiating with hospitals and doctors to set up a network of providers. An insurer can negotiate good rates if it has a big base of customers, but it needs good rates to build up a big base of customers. Insurers leave a state altogether if it can't overcome this catch-22. That's why you can't just buy health insurance from an out-of-state insurer who doesn't have a network in your state.

Letting people buy insurance across state lines will only cause all the insurers already in your state to elect to be regulated by a different state, likely one with the most anti-consumer insurance commission.