Why are we so paranoid about having choices?

[rbmrtn]

Someone posted that you have to get a Silver plan to get a subsidy...


Is this correct I thought it was based on the Bronze plan and applied to the Bronze plan....


If I am wrong, that might make a big change in my decision...

There is addition cost sharing support if FPL is below 250% but only for silver plans. Other than that your subsidy is calculated from the cost of the 2nd lowest cost silver plan available to you. The subsidy can be applied to any plan.

 

[Rpharmer]

Someone posted that you have to get a Silver plan to get a subsidy...


Is this correct I thought it was based on the Bronze plan and applied to the Bronze plan....


If I am wrong, that might make a big change in my decision...

To qualify for "cost-sharing" subsidies, which can reduce your deductible, out-of-pocket-max, various co-pays, etc., you must choose a Silver plan. You must also meet more stringent income requirements. The "premium" subsidy, on the other hand, can be applied to any metal-level plan. In other words, there are two distinct types of subsidies, and it is not always clear which ones are being discussed. But most people have focused on the premium subsidies, since they are available to incomes up to 400% of FPL.

Not everyone who gets a premium subsidy will also qualify for the additional cost-sharing subsidies. You must have a MAGI in the lower income ranges to also qualify for cost-sharing subsidies.

For example, in the extreme, where MAGI is between 100% and 150% of FPL, a plan's actuarial value must be 94%. AV is complicated. But one way of raising it is by lowering a plan's deductible and OOP max, and that is what some plans have done.

In this example, using a MAGI of $16000 (roughly 139% of FPL), I found a plan with a $250 annual deductible and a $500 out-of-pocket max. It is, as required, a Silver plan. So, it's premiums are somewhat higher than the Bronze plan. But the Bronze plan cannot offer cost-sharing subsides, and it's comparable deductible in this plan was $5000, with an out-of-pocket max of $6250. It's actuarial value is estimated to be 60%.

Lower actuarial value plans, and high-deductible plans, are appropriate for many people, such as those who anticipate lower medical expenditures. Their goal may be to keep premiums lower, and insure against large, perhaps unpredictable events. Some people maintain that that is how all insurance decisions should be approached.

But the ACA requires the coverage of known, pre-existing conditions. If you are taking several expensive prescriptions, for example, that have no generic equivalent, or you have a medical condition that you know requires expensive treatment, a high deductible, high OOP max, low actuarial value plan may not make economic sense for you. What you will save with twelve low premiums could be overwhelmed by your other out-of-pocket costs.

These are my personal interpretations of the ACA, guided mostly by reading the Kaiser Family's healthcare reform articles.

 

[Texas Proud]

To qualify for "cost-sharing" subsidies, which can reduce your deductible, out-of-pocket-max, various co-pays, etc., you must choose a Silver plan. You must also meet more stringent income requirements. The "premium" subsidy, on the other hand, can be applied to any metal-level plan. In other words, there are two distinct types of subsidies, and it is not always clear which ones are being discussed. But most people have focused on the premium subsidies, since they are available to incomes up to 400% of FPL.

Not everyone who gets a premium subsidy will also qualify for the additional cost-sharing subsidies. You must have a MAGI in the lower income ranges to also qualify for cost-sharing subsidies.

For example, in the extreme, where MAGI is between 100% and 150% of FPL, a plan's actuarial value must be 94%. AV is complicated. But one way of raising it is by lowering a plan's deductible and OOP max, and that is what some plans have done.

In this example, using a MAGI of $16000 (roughly 139% of FPL), I found a plan with a $250 annual deductible and a $500 out-of-pocket max. It is, as required, a Silver plan. So, it's premiums are somewhat higher than the Bronze plan. But the Bronze plan cannot offer cost-sharing subsides, and it's comparable deductible in this plan was $5000, with an out-of-pocket max of $6250. It's actuarial value is estimated to be 60%.

Lower actuarial value plans, and high-deductible plans, are appropriate for many people, such as those who anticipate lower medical expenditures. Their goal may be to keep premiums lower, and insure against large, perhaps unpredictable events. Some people maintain that that is how all insurance decisions should be approached.

But the ACA requires the coverage of known, pre-existing conditions. If you are taking several expensive prescriptions, for example, that have no generic equivalent, or you have a medical condition that you know requires expensive treatment, a high deductible, high OOP max, low actuarial value plan may not make economic sense for you. What you will save with twelve low premiums could be overwhelmed by your other out-of-pocket costs.

These are my personal interpretations of the ACA, guided mostly by reading the Kaiser Family's healthcare reform articles.

Thanks for the info.... it is helpful....

But, it would seem that the cost sharing plan is not something that you can get after the fact.... IOW, if your income was high when you sign up and they think you do not qualify for the premium subsidy... when it comes time to file your tax return you will get the subsidy.... However, I do not see them going back and paying for any of your OOP expenses that you might have qualified for if you had started with the low income...


I doubt any of this will affect me, but you never know....

 

[haha]

Thanks for the info.... it is helpful....

But, it would seem that the cost sharing plan is not something that you can get after the fact.... IOW, if your income was high when you sign up and they think you do not qualify for the premium subsidy... when it comes time to file your tax return you will get the subsidy.... However, I do not see them going back and paying for any of your OOP expenses that you might have qualified for if you had started with the low income...


I doubt any of this will affect me, but you never know....

Who knew that socialism could be this hard?

 

[pb4uski]

Thanks for the info.... it is helpful....

But, it would seem that the cost sharing plan is not something that you can get after the fact.... IOW, if your income was high when you sign up and they think you do not qualify for the premium subsidy... when it comes time to file your tax return you will get the subsidy.... However, I do not see them going back and paying for any of your OOP expenses that you might have qualified for if you had started with the low income...


I doubt any of this will affect me, but you never know....

Who knew that socialism could be this hard?

Yes, there are lots of pesky details that the geniuses in DC didn't think through.

 

[Rpharmer]

Thanks for the info.... it is helpful....

But, it would seem that the cost sharing plan is not something that you can get after the fact.... IOW, if your income was high when you sign up and they think you do not qualify for the premium subsidy... when it comes time to file your tax return you will get the subsidy.... However, I do not see them going back and paying for any of your OOP expenses that you might have qualified for if you had started with the low income...


I doubt any of this will affect me, but you never know....

You are welcome. I think you're right that the cost sharing subsidy may only be an "up front" option, when your deductible and other parameters are determined upon enrollment. I can't recall what I've read about this specifically, outside of the enrollment/eligibility process. (I'm afraid that I tend to forget the details that I don't think will involve me -- there are so many -- and then there's my diminishing supply of neurons!)

The premium subsidy does seem easier to adjust after the fact (or during the year, when you report an event that would impact it.) That part is addressed in the application. But you certainly have to do a little more digging on the cost sharing rules, that's for sure. My guess is that it is all addressed in the law itself, but that is laborious reading, and the index isn't much help in getting you to the parts you're interested in. So, that's why sites like this are such a help. Thanks, ER's!

 

[47]

The more choices IMHO, the more opportunities for getting duped by the insurance companies. I have over 80 plan choices. WHY? All I need is one good option. I really am having a difficult time in choosing. I am concerned that if I choose one, and omit to read every word of the plans small and large print I will be short something.

Insurance companies spend their lives trying to confuse people as to what coverage they get at what cost. We do not have a healthcare problem we have an insurance problem. Let us fix the insurance problem and the healthcare will take care of itself.

PS. Healthcare.gove has been working fine for me in FLA. Why are we still complaining about it?

Aren't the metal levels supposed to fix that? Are you shopping outside of the exchange? Granted it is still a pain in the official website.. but there are other websites to see the options available easily..

Once you determine the metal level you want, you just keep going up from the lowest premium till you find a network you can live with.

 

[47]

Yes, there are lots of pesky details that the geniuses in DC didn't think through.

As the oft used cliche goes.. Perfect is the enemy of the good.

The only question we need to ask is "is this better than what we had?".

For a lot of people who needed access to health care and were shut out the answer is most definitely yes. But unfortunately for some.. not so much.

I confess I am philosophically pro-ACA. But I do see the warts it has too.

For everyone who complains vocally on TV about their insurance rate going up.. way up.. if I were the reporter I would ask the following questions..

1) Did you check if you qualified for a subsidy.

2) Did you know that the insurance company was under no obligation to renew your policy even without ACA.

3) Do you know if you had an annual cap on your policy? How much was it?

4) Do you know if you had a lifetime cap on your policy? How much was it?

5) Did you make any claims in the past 3 years? How was your experience?

6) Are you in any age threshold.. such as going from 39 to 40, or 49 to 50? This may explain some or most of the premium increase.

7) Would you place some value on guaranteed-issue of insurance? i.e. you cannot be denied coverage due to pre-existing conditions?

If even after all this they are upset about the premium increases, they are genuinely affected and they do need to be listened to sympathetically. They are one of the genuine losers in this shake-up, however well-intentioned it is.

I understand it is hard to make someone understand some issues that didn't actually happen to them. But it is not like insurance horror stories were non-existent before. But somehow all the media coverage is all totally virgin coverage as if all the reporters were born after July 2013.

 

[47]

I pretty much disagree with everything she wrote.

Fundamentally insurance should protect people from rare, but super expensive event. Maternity coverage fails both criteria.

Lost in the authors babble about $30K maternity bills, is a simple fact. According to several source on google the average cost for delivery in the US is $3,500. Now that is a decent chunk of change, put relatively small compared to the overall cost of having a kid.

I am not arguing your premise that to each their own in terms of health care cost. But I think your $3,500 figure is missing a zero at the end.

Here is a more representative link.
http://transform.childbirthconnecti...03/national-maternity-payment-comparison1.pdf

Note that these graphs DO NOT include anesthesia charges and newborn care charges as per the footnote. Ouch!! Just cut her up and pull it out, then pack it up all to go!

These are 2010 figures, and you may have to add 30-40% to those numbers now.

I have had various women go through pregnancies in my family over past few decades and I don't know what a "birth center" is. The birth center costs seem quite tempting and are somewhat in line with your $3,500 number. Maybe they just have one midwife with some vaseline.. not sure how it works. But hospital deliveries in Metro areas are definitely in the five figures. Prenatal care is not included in these figures.

 

[samclem]

The only question we need to ask is "is this better than what we had?".

That is a false dilemma. Instead we need to consider the full range of options, not just "this or that." It goes to the very subject of this thread.

If even after all this they are upset about the premium increases, they are genuinely affected and they do need to be listened to sympathetically.

It's not made right by "listening to them sympathetically." These people just want what they had before this ACA became law: the contract they had between themselves and their insurer (two private parties that both deemed the arrangement to be mutually beneficial).

 

[Malcolm2]

That is a false dilemma. Instead we need to consider the full range of options, not just "this or that." It goes to the very subject of this thread. It's not made right by "listening to them sympathetically." These people just want what they had before this ACA became law: the contract they had between themselves and their insurer (two private parties that both deemed the arrangement to be mutually beneficial).

+1

They should be able to _keep_ their policies, not just be listened to which is telling them someone else knows better -typically false. Having 50 million lose policies is not what was promised, but perhaps was what was intended.
Washington Post today:

http://m.washingtonpost.com/nationa...f9670a-4bca-11e3-be6b-d3d28122e6d4_print.html

 

[MichaelB]

The reaction to the cancellations is understandable and even reasonable. Under the previous system, however, consumers had no choice or say in the matter. The insurer unilaterally chose whether nor not to renew a policy and so informed the policyholder. Every year countless policies were cancelled, the primary reason being because they were were needed. Consumers then found themselves without any policy option and newly uninsurable.

Since I retired 14 years ago I've had 4 policies cancelled.

 

[Gatordoc50]

All that is happening with the exception of the website malfunction was completely predictable. There was only one person in the country that was saying this would be seamless and that premiums were going to go down and that you could keep your doctor. Only one. Shame on anyone who relied on this one source. They have no right to complain.

 

[Mulligan]

The reaction to the cancellations is understandable and even reasonable. Under the previous system, however, consumers had no choice or say in the matter. The insurer unilaterally chose whether nor not to renew a policy and so informed the policyholder. Every year countless policies were cancelled, the primary reason being because they were were needed. Consumers then found themselves without any policy option and newly uninsurable. Since I retired 14 years ago I've had 4 policies cancelled.

That scenario you faced Michael would be very problematic for someone who develops an ongoing health issue after getting a policy then getting cancelled. I get a one year reprieve then I am thrown into the pot, so status quo would obviously benefit me. But looking forward, while it sounds nice for legislation to allow you to keep current policy, I think it would eventually be counter productive to most of us in the end. Exchange would start out as a glorified high risk pool and rates would sky rocket. Then when the insurance company does get a chance to drop you they will. What incentive would there be to keep you on a cheaper plan? My rates are going up 3X current amount. But I would rather pay that than 6X if I get dumped into a national high risk pool exchange.

 

[MRG]

All that is happening with the exception of the website malfunction was completely predictable.

Not to disagree, but the website issues were totally predictable, IMHO mostly preventable. Sure it would have some issues the first week, but this is silly. If Megacorp had ever dropped the ball like this, they would have been bankrupted.

MRG

 

[Gatordoc50]

That scenario you faced Michael would be very problematic for someone who develops an ongoing health issue after getting a policy then getting cancelled. I get a one year reprieve then I am thrown into the pot, so status quo would obviously benefit me. But looking forward, while it sounds nice for legislation to allow you to keep current policy, I think it would eventually be counter productive to most of us in the end. Exchange would start out as a glorified high risk pool and rates would sky rocket. Then when the insurance company does get a chance to drop you they will. What incentive would there be to keep you on a cheaper plan? My rates are going up 3X current amount. But I would rather pay that than 6X if I get dumped into a national high risk pool exchange.

+1
You can't go backwards and distort the risk pools. That would be a huge mistake.

 

[Mulligan]

+1 You can't go backwards and distort the risk pools. That would be a huge mistake.

Yes, we don't need to make it worse as we are already counting on 20 something's to buy health insurance which will be problematic enough already....I was watching a program that was interviewing random people about Obamacare. They interviewed this mid 20 something lady. She knew very little about it, and then they asked her if she even had insurance, and she said she "didn't know if she did". I hope I am not counting on many of those type to keep my rates down!

 

[Gatordoc50]

Not to disagree, but the website issues were totally predictable, IMHO mostly preventable. Sure it would have some issues the first week, but this is silly. If Megacorp had ever dropped the ball like this, they would have been bankrupted.

MRG

Ya, a couple of computer geeks threw one together at I would guess little or no cost. But the real site is being used for much more than insurance choices. It reminds me of a SNL skit. It's an insurance exchange AND an espionage tool AND a wealth transfer device AND a dessert topping!

 

[travelover]

..........
It's not made right by "listening to them sympathetically." These people just want what they had before this ACA became law: the contract they had between themselves and their insurer (two private parties that both deemed the arrangement to be mutually beneficial).

The part I have a problem with is that we (all Americans) have a societal contract to pay for any medical care that the patient can't afford themselves. So, if you can afford a policy with no caps, but choose to buy an inexpensive capped policy, you are in effect pushing the risk off on the rest of society - the hospital and the other patients that must pay higher premiums to cover the uncompensated care.

 

[47]

That scenario you faced Michael would be very problematic for someone who develops an ongoing health issue after getting a policy then getting cancelled. I get a one year reprieve then I am thrown into the pot, so status quo would obviously benefit me. But looking forward, while it sounds nice for legislation to allow you to keep current policy, I think it would eventually be counter productive to most of us in the end. Exchange would start out as a glorified high risk pool and rates would sky rocket. Then when the insurance company does get a chance to drop you they will. What incentive would there be to keep you on a cheaper plan? My rates are going up 3X current amount. But I would rather pay that than 6X if I get dumped into a national high risk pool exchange.

The status quo you mention is the insurer just collecting your premium.. not providing you a usable service. That would be continuing the insurance when you actually need it.

What people don't understand.. or refuse to understand.. is that most of the junk policies were not insurance at all. They were just one-way payment arrangements. Every year, the insurance companies would decide whether the next year they would rather take your money or pay for your medical services. In the mean time you are older by a year with all the ailments that come with steadily marching steadily towards your body's use-by date, and the insurance companies are that much richer.

Unless you received a rejection notice from an insurance company.. NOT an insurance premium increase mind you.. just outright rejection saying "no can do" -- you cannot really comprehend what the old situation was under the surface. Needless to say I did, and that completely changed my perspective.
We were financially doing okay, and all I wanted was some kind of catastrophic insurance to protect the assets in the worst case.

We had no chronic diseases, and our claim history in the past two years were close to zero. The reason for rejection.. My wife having had a C-section delivery (no other complications) with the past 5 years was considered a pre-existing condition, and that was that. It was not by our choice. In the US one third of the deliveries are through c-section.

Arguing about a $100/month premium increment sounds downright petty to me when weighed against guaranteed insurance for *life*, as you also concluded.

The following is an interesting read and parallals my own experience. It appeared well before ACA was okayed by the courts.
http://www.nytimes.com/2011/02/20/opinion/20Dubinsky.html

 

[Hamlet]

Yup, the old system for individual health insurance was incredibly bad, probably as bad a system as could be devised if you were trying to make it bad. People who never had any health issues liked it okay (who wouldn't), but anyone who actually needed care over the long term would be screwed eventually.

The new system has a lot of stupid things in it, but I think it is going to be a major improvement over the current system. Of course, just about anything would be.

The reaction to the cancellations is understandable and even reasonable. Under the previous system, however, consumers had no choice or say in the matter. The insurer unilaterally chose whether nor not to renew a policy and so informed the policyholder. Every year countless policies were cancelled, the primary reason being because they were were needed. Consumers then found themselves without any policy option and newly uninsurable.

Since I retired 14 years ago I've had 4 policies cancelled.

 

[NW-Bound]

...
Here is a more representative link.
http://transform.childbirthconnecti...03/national-maternity-payment-comparison1.pdf

Wow! The cost for natural childbirth with no complications varies from $6K in Maryland to $10K in Arizona, and tops out at $18.5K in New Jersey. What's going on here? A variation of 3X between states? The $6K looks more than enough to pay for the staff in the delivery room, and the 1 or 2-day hospital stay.

It was many years ago that we had to deal with child delivery, and then everything was covered by megacorp insurance so we had no idea what it cost back then.

 

[Gatordoc50]

Wow! The cost for natural childbirth with no complications varies from $6K in Maryland to $10K in Arizona, and tops out at $18.5K in New Jersey. What's going on here? A variation of 3X between states? The $6K looks more than enough to pay for the staff in the delivery room, and the 1 or 2-day hospital stay.

It was many years ago that we had to deal with child delivery, and then everything was covered by megacorp insurance so we had no idea what it cost back then.

That is quite a disparity. There will still be disparities between areas due to population, physical access to care, and even whether or not you are in a right to work state. I would guess that if you're in an area that won't let you pump your own gas, your colonoscopy is going to be more expensive. To be c

 

[sailor]

I am not arguing your premise that to each their own in terms of health care cost. But I think your $3,500 figure is missing a zero at the end.

Here is a more representative link.
http://transform.childbirthconnecti...03/national-maternity-payment-comparison1.pdf

Note that these graphs DO NOT include anesthesia charges and newborn care charges as per the footnote. Ouch!! Just cut her up and pull it out, then pack it up all to go!

These are 2010 figures, and you may have to add 30-40% to those numbers now.

I have had various women go through pregnancies in my family over past few decades and I don't know what a "birth center" is. The birth center costs seem quite tempting and are somewhat in line with your $3,500 number. Maybe they just have one midwife with some vaseline.. not sure how it works. But hospital deliveries in Metro areas are definitely in the five figures. Prenatal care is not included in these figures.

I went to the source of the data ( HCUPNet project).
And I think you are both right - where the disagreement is, that the charge is not the cost.
If I got it right - "charge" is the "sticker price" hospital puts on your bill, and the "cost" is whatever insurance+patient paid.


As a side note I enthusiastically support birthing centers (but did not have access to one with our kids) and midwifes (Kaiser midwifes helped with deliveries all 3 of little sailors).

National stats from 2011 from HCUPNet:

2011 National statistics - principal diagnosis only
Outcomes by Normal pregnancy and/or delivery
Normal pregnancy and/or delivery Standard errors
Total number of discharges 225,214 11,484
Charges, $ (mean) 10,644 377
Costs, $ (mean) 3,039 65

 

[Hamlet]

I think the big issue is that many of the pre-ACA policies wouldn't have covered the unusual pregnancy, or the sick child after it was born. It isn't that rare to have a premature birth, and severe cases can result in six figure medical bills.

That needs to be covered, or the policy doesn't really function as insurance.

Remember, under the ACA, pregnancy has to be covered in the plan, but as far as I know it still has to reach the deductible before the insurance company has to pay out, so the cost of the run of the mill variety birth is likely to be mostly born by the consumer if they have one of the higher deductible options.

So I am fine for having unusual/life threatening pregnancy being covered but not the run of the mill variety. If people want to protect against those type of risks they should pay for it.