United Health may stop offering ACA Exchange plans

[Mulligan]

Here is ultimately the ACA plans undoing.... I have repeated this before but no one has ever really challenged it as they keep saying people will have to "pay the penalty". As people will figure out after this year..."there is no penalty". There are 15 exemptions with the 14th one being a catch all. If you have a pulse, you can find an exemption. When people get their tax returns confiscated or actually realize the exemptions they wont buy the insurance if they believe they cant afford it. And even if some miracle comes that you are not smart enough to use exemption #14 which is simply a "hardship" and provide documentation "if possible", you deserve quite frankly to pay double the penalty. Heck you can also go to jail one day a month and then be exempted... And above all that....If you are too lazy to not claim a "hardship" by providing no documentation, you can simply not have a refund and you don't pay the penalty. People are going to figure this out that it is a law with no teeth...


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[Texas Proud]

Also, as someone else mentioned.... I am surprised that the margins are so low considering how much insurance actually costs...


There has to be a bunch of really sick people out there that cost a heck of a lot of money... my insurance costs next year will be over $10K... but if it is like this year I will 'use' a few hundred of services... now, if we do have some major problem, I will have to pay the almost $14K OOP.... we have never come close to this amount of service...


I will just leave it at that as I do not want to contribute to the closing of this interesting thread...

 

[DEC-1982]

I think any new program has startup problems. Studying the history of Medicare confirms this. Give ACA a few years.

 

[travelover]

......... Give ACA a few years.

I think we have no choice. I don't see anyone clamoring to go back being uninsurable.

 

[GTFan]

Yep, I think we're basically in hope-and-pray mode (or whatever you want to call wishful thinking) WRT the ACA future. There's just so many unknowns at this point as to whether there will be enough of a balanced risk pool to keep it affordable and in a competitive market. We've already seen networks shrinking and insurers pulling out of markets along with excessive price increases in many areas.

The sad truth is that with today's political environment I think it would take a complete collapse of the market to get anything done further reform-wise, and even then it's a stretch.

 

[explanade]

I think we have no choice. I don't see anyone clamoring to go back being uninsurable.

There's going to be a push for repeal for a long time.

And some advocate allowing pre existing conditions is unfair to insurers.

 

[Gotadimple]

A perfect example of the process being confusing is what happened today with me. My brother emailed me this morning saying his insurance is dropping out of state at end of year. He asked me which one I had so he can get it. He lives across the state. He has no clue, that you just don't buy "what I have". He has no clue about coverage areas, in network, out of network, making sure his preferred medical providers are in the plan he buys, etc... This is not going to be able to answered with an email. We are going to have to have a bit of a discussion...


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I just went through this with my brother. Except his question was "Do you have Medicare Part A and B, and if so, why do you have it?"

Best of luck.

 

[easysurfer]

There's going to be a push for repeal for a long time.

And some advocate allowing pre existing conditions is unfair to insurers.

I think a push or not depends a lot on who gets elected next year. If the side that is for the ACA is elected, that'll be at least 4 more years of the ACA as law of the land. If the side that is for repeal gets elected, then all bets are off (or the push to repeal might be a, "Oh, never mind").

I read about a month ago a thought (article or blog) that expressed, wouldn't it be nice if there was a super HSA. As things stand now, the very wealthy don't benefit from subsidies and the poorer can't afford to utilize an HSA and the eligible HSA deduction is no real benefit to them.

I didn't post a link to article/blog as that started out like "This political side thinks such and such and the other side thinks this", so I avoided the Porky. But IMO, the thought of a super HSA is intriguing.

 

[Gotadimple]

Health care insurance is the US is very complex. Each state regulates it differently, prices and costs are secret and variable, and the health care insurance industry has evolved by focusing on exclusion, so it has thousands of different groups and networks to manage. Most individuals got their coverage from employer, who dealt with all this complexity. So many are now seeing it for the first time as individuals, and conclude this complexity (and cost) is recent.

In fact, the ability to easily compare policies is new, the result of minimum coverage mandates. Same for comparing provider networks, which we can do now because insurers must enable that. Before these mandates it was much more difficult to compare policies.

Rounding back to the original topic, is this a case where UHC has too many sick people on it's policies, or could it be UHC management is having a rough time executing their business strategy in the individual market and they are throwing the blame elsewhere?

Or it's a trial balloon.
Or it's an inexperienced management in charge of the individual market casting blame.
Or . . .

As others have said, they are not a big part of the individual market. I surmise they didn't price properly and 1) did not get enough members to cover their overhead, 2) thought they were getting young and healthy and got less healthy and more claims, and/or 3) underestimated what they thought they knew about the ACA regulations.

- Rita

 

[Clone]

We have had UHC insurance through MegaCorp for many years. And insurance in retirement is part of the package.

I have seen UHC buy companies, use them up, spit them out. Make alliances, then break alliances.

We just got a letter in the mail that says:

'Beginning January 1, 2016, your plan will feature the UnitedHealthcare Value Pharmacy Network, which does not include CVS PHARMACY.'

In other words, they could not cut the deal with CVS that they wanted, so they cut them out. So, we need to switch to a different pharmacy. Of course, UHC would like to have us buy direct from OptumRX, which happens to be a company they bought. There are other local pharmacies that are, for the moment, still allowed.

I suspect that UHC is simply publicizing the possible change to apply what they see as pressure to the ACA system. If they can't make their margin, they will drop that part of the business. This way they have made disclosure that it might happen.

 

[travelover]

...........I read about a month ago a thought (article or blog) that expressed, wouldn't it be nice if there was a super HSA. As things stand now, the very wealthy don't benefit from subsidies and the poorer can't afford to utilize an HSA and the eligible HSA deduction is no real benefit to them...............

I was under the impression that employer provided insurance was tax free. If you are very wealthy, that would put you in the 39% tax bracket. Wouldn't tax free health insurance be a subsidy?

 

[NW-Bound]

... people are wanting lowest possible price and maximum use of services....

My favorite example of insurance was a letter an insurance company released a few years ago from a very happy customer. She wrote the company about how pleased they were with all the coverage they provided. She said she got married and was wanting a baby so she picked their insurance because she heard good things about them. Then she said she was dropping them since they are not having any more children. But if they ever did she wanted them to know she was going to sign back up with them. You just cant make this stuff up!

We know good things about just-in-time (JIT) manufacturing. Now, we have JIT health insurance.

...
The biggest problem with the ACA is the fact that healthcare is very expensive in the US, but this high cost is only really visible on individual ACA policies. Medicare and employer policies (and other sources) cost just as much, but those costs are not put on public display for all to see and discuss.

+1

When it is OPM, people do not care that much. Well, except that Medicare and employer-provided money are not OPM either. It all comes out of our pockets, just indirectly in the form of higher taxes or lower pays.

 

[Mulligan]

I think a push or not depends a lot on who gets elected next year. If the side that is for the ACA is elected, that'll be at least 4 more years of the ACA as law of the land. If the side that is for repeal gets elected, then all bets are off (or the push to repeal might be a, "Oh, never mind").

I read about a month ago a thought (article or blog) that expressed, wouldn't it be nice if there was a super HSA. As things stand now, the very wealthy don't benefit from subsidies and the poorer can't afford to utilize an HSA and the eligible HSA deduction is no real benefit to them.

I didn't post a link to article/blog as that started out like "This political side thinks such and such and the other side thinks this", so I avoided the Porky. But IMO, the thought of a super HSA is intriguing.

Hey, I would party all night long if that ever came to be. But lets be honest...That would only benefit rich people or people like me...Meaning someone who can still afford it, but complains mightily about the cost. And it certainly doesn't address cost containment or help low incomers.


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[easysurfer]

Hey, I would party all night long if that ever came to be. But lets be honest...That would only benefit rich people or people like me...Meaning someone who can still afford it, but complains mightily about the cost. And it certainly doesn't address cost containment or help low incomers.


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The gist of that blog/article (which I can't find ) was about how to best get everyone insured and yet have a system that would work for both sides. At least according to the author.

 

[Mulligan]

The gist of that blog/article (which I can't find ) was about how to best get everyone insured and yet have a system that would work for both sides. At least according to the author.

Just about everyone would have an subsidy then if we could add that in with existing subsidies....Except who is going to pay for it? The middle class just above the subsidy line and dont make enough to save for the deduction?


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[Dreaming of Freedom]

If ACA is repealed or implodes, and the US health insurance market and/or cost of healthcare becomes hard to afford or obtain, is anyone else thinking of retiring to another country for better, more affordable healthcare? If yes, what countries are worth looking at? I am not waiting until age 65 to retire just so I can have some crappy health insurance policy that doesn't pay anything through my employer.

Racing for the FIRE finish line, but I don't know where it is.

 

[travelover]

If ACA is repealed or implodes, and the US health insurance market and/or cost of healthcare becomes hard to afford or obtain, is anyone else thinking of retiring to another country for better, more affordable healthcare? If yes, what countries are worth looking at? ..........

Yea, I can pretty easily see 300 million Americans moving to say, Canada or Thailand. This might be a real estate opportunity.

 

[Mulligan]

Yea, I can pretty easily see 300 million Americans moving to say, Canada or Thailand. This might be a real estate opportunity.

Yes there are easier options that many people already utilize. 1) Just not buy it 2) Stiff the company when billed 3) Tell them you cant pay, and negotiate $20 a month for years on end 4) Sign up during the ACA window, utilize the heck out of it for first couple months for all your needs, then drop it till next year.


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[marko]

I think any new program has startup problems. Studying the history of Medicare confirms this. Give ACA a few years.

Thing is, even on this forum of above average intelligent, savvy people there remains a ton of confusion. I've been following it for over a year now and still don't have my arms completely around how this is supposed to work.

This isn't startup problems. I spent my whole career in "new product rollouts".
This is a program that wasn't fully thought out, poorly executed and even more poorly explained. I've yet to meet an average Joe who has any clue on how this works.

It's as if everybody said: "Ok, we got it into law" and then just walked away as if the passing was the goal and not the starting point.

The bad news is the next time someone want to pass some good sweeping legislation, the implementation of this mess will be pointed to as a reason not to.

 

[ziggy29]

It's as if everybody said: "Ok, we got it into law" and then just walked away as if the passing was the goal and not the starting point.

Normally the sane, reasonable thing to do (IMO) is to look at what is working, what is not working, and legislate to build on the successes while addressing the actual or potential failures. Unfortunately that mindset seems to be in *very* short supply at the Capitol these days, with one group wanting to blow up the law almost entirely, and the other spending all their time preventing such a thing (and thus defending the status quo).

 

[travelover]

.......It's as if everybody said: "Ok, we got it into law" and then just walked away as if the passing was the goal and not the starting point..............

Revolution is always much easier than governing. It will work out in the end - we're still quarreling over exactly what the Constitution means.

 

[Mulligan]

Normally the sane, reasonable thing to do (IMO) is to look at what is working, what is not working, and legislate to build on the successes while addressing the actual or potential failures. Unfortunately that mindset seems to be in *very* short supply at the Capitol these days, with one group wanting to blow up the law almost entirely, and the other spending all their time preventing such a thing (and thus defending the status quo).

I read an article on this issue concerning United and its exchange problems today. One "expert" thinks the marketplace will evolve in a different manner. First he blamed United for its own problem as they offered broad networks for their plans thus not controlling costs. He said this market will undergo a "massive shift away from traditional insurers toward managed care providers that specialize in Medicaid and other government programs. He also said, "In short order, Obamacare is evolving into a Medicare marketplace, not only in terms of design and quality of the narrow network plans being offered, but in the actual carriers that sell those policies".


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[youbet]

If they can't make their margin, they will drop that part of the business.

I would certainly hope so!

Our gov't set up ACA with rules they thought would allow insurers to operate and make a profit. Insurers analyzed the numbers and some made the decision to participate (with the objective of making a profit from their participation). Now that some time has passed, some insurers are either changing their offerings or dropping out altogether. That's how our economy works.

The fact that UHC feels that the effort and investment in ACA participation would be better spent someplace else is fine. The least efficient (in this particular business niche) has dropped out. Hooray! The system kinda works!

I expected change in who is participating and what the offerings are from the get-go. I'm also expecting more change in the future.

 

[rdy2go]

If the post that showed that insurance companies are only making a 2% profit on the ACA business then I would have to ask how long they will stay in the program? Publicly held companies are expected to return a better ROE to their shareholders than 2%, and an insurance company would be likely to drop out of this line of business before their bottom line suffers too much. There will need to be more subsidy of losses by the taxpayers to keep the companies in the marketplace.

One of the problems facing the companies that got into writing insurance for the marketplace is that they had no way to know what their results would be when they started taking new customers that had pre-existing conditions and medical needs that are greater than the premiums they pay going in. The previously uninsured and uninsurable are now being charged the same premiums as the healthy people and no one knew going in what the costs would have to be to cover the group and still make a profit. Their past history of underwriting risk goes out the window when they had to take all comers without being able to price them according to the exposure they present.

 

[photoguy]

If the post that showed that insurance companies are only making a 2% profit on the ACA business then I would have to ask how long they will stay in the program? Publicly held companies are expected to return a better ROE to their shareholders than 2%, and an insurance company would be likely to drop out of this line of business before their bottom line suffers too much.

Can you clarify which post were you referencing? I thought that health insurers are generally in the 2% range when profit is measured as a function of revenue as opposed equity.