Bronze, Silver and Coinsurance/Copay

[audreyh1]

Just curious - what deductible and total OOP are you choosing? If I'm being too nosy don't answer...
I've narrowed it to either $3500 or $6250 for us, still wavering. It is insurance, so we should probably go with the lowest premium / highest deductible.

I'm leaning toward the Bronze with a $5000 deductible and $6250 max OOP in network, 20% coinsurance.

There is no Bronze option available to us with a $3500 deductible. Two PPO choices - $6000/$6000 or $5000/$6250 everything else identical. The second is $3 more a month.

If I want a $3500 deductible PPO I have to go to a Silver plan and pay a significantly higher premium.

Considering you have been the font and champion of knowledge on this very topic, MichaelB, I am more than happy to contribute a few details.

 

[MichaelB]

I'm leaning toward the Bronze with a $5000 deductible and $6250 max OOP in network, 20% coinsurance.

There is no Bronze option available to us with a $3500 deductible. Two PPO choices - $6000/$6000 or $5000/$6250 everything else identical. The second is $3 more a month.

If I want a $3500 deductible PPO I have to go to a Silver plan and pay a significantly higher premium.

Considering you have been the font and champion of knowledge on this very topic, MichaelB, I am more than happy to contribute a few details.

Thanks! Probably we'll end up with that similar Fl version.

It's even easier to make that decision if you can use all of the premium difference to fund an HSA to cover the higher deductibles.

This is something I absolutely need to keep in mind. As our premium declines, the difference is not available for other spending. It's not "real" savings, it needs to be set aside to fund potential future health care expenses.

 

[ziggy29]

I'm leaning toward the Bronze with a $5000 deductible and $6250 max OOP in network, 20% coinsurance.

There is no Bronze option available to us with a $3500 deductible. Two PPO choices - $6000/$6000 or $5000/$6250 everything else identical. The second is $3 more a month.

I'd probably lean that way as well. It doesn't speak of average-case situations but going with the $5000/$6250 plan, worst case it costs you an extra $286 (with over $10K in medical expenses) -- but best case it can save you $764 (with exactly $6K in expenses).

 

[ziggy29]

This is something I absolutely need to keep in mind. As our premium declines, the difference is not available for other spending. It's not "real" savings, it needs to be set aside to fund potential future health care expenses.

Yep. It's always easier to save money when you treat it as "gone" before it ever hits your checking account for available spending!

 

[audreyh1]

I'd probably lean that way as well. It doesn't speak of average-case situations but going with the $5000/$6250 plan, worst case it costs you an extra $286 (with over $10K in medical expenses) -- but best case it can save you $764 (with exactly $6K in expenses).

Right. And you have coinsurance jumping in at $5000, which can at least slow down the bleeding!

The amount that you save in premiums better go to the "pay for doctors visits" pile. Since routine health checks are already paid for by even the bronze premium, that money really goes for extra doctor visits. Then, if you don't spend it all - it's available for the next year!

We already have savings set aside for whatever - travel for example. If one of us gets ill enough to start paying a lot for health care due to our high deductible, we'll probably not be traveling during that period, so the money would just be diverted.

 

[rbmrtn]

I've narrowed it to either $3500 or $6250 for us, still wavering. It is insurance, so we should probably go with the lowest premium / highest deductible.

I found this article discussing why bronze may be the best choice. Essentially now your OOPM really is the max. it includes deductibles/co-pay/co-ins, whereas before they could stack all of those on top of each other.

Bronze May Be the Most Precious Metal Under Obamacare | Hull Financial Planning

 

[ziggy29]

I found this article discussing why bronze may be the best choice. Essentially now your OOPM really is the max. it includes deductibles/co-pay/co-ins, whereas before they could stack all of those on top of each other.

It's usually true of any insurance. If you don't expect to have significant medical costs in any given year and you can afford to self-insure, higher deductibles are almost always financially advantageous. As I said before, though, that requires enough discipline to firewall or set aside enough of your income/assets as "in reserve" to pay the higher deductibles and OOP limits.

ACA did standardize the way these things are treated and made cost comparisons much easier, and the website fiasco notwithstanding that much is a good thing. It's a lot easier to compare apples to other apples than to oranges....

 

[Texas Proud]

You need to go through the Exchange to be eligible. So in reality, if someone is expecting a very small subsidy, they may just decide it's not worth dealing with the healthcare.gov mess, paying a little more and buying direct from the insurer with much more ease. Then one could go to the Exchange in 2015, by which time the bugs should be pretty much all worked out.

But what if after the fact your circumstances changed and you are eligible for a big subsidy

I am a perfect example.... last year at this time I would not have qualified for a subsidy or a small one.... but now that I do not work, when I file my tax return I would qualify for a bigger one.... With being able to claim a subsidy or a credit ONLY if you buy through the exchange means that it would not be smart to buy anyplace else except the exchange.... because if you do and circumstances change.... well, too bad for you....

 

[ziggy29]

With being able to claim a subsidy or a credit ONLY if you buy through the exchange means that it would not be smart to buy anyplace else except the exchange.... because if you do and circumstances change.... well, too bad for you....

If you think your circumstances may significantly change during 2014, I think this is true. That said, if you're pretty confident your situation won't change in 2014 (i.e. no chance to qualify for tax credits or cost sharing) or you decide the headaches of the healthcare.gov mess aren't worth potentially saving a few bucks (a "few" being in the eyes of the beholder), then you can go off the exchange.

The rest of us (especially those in a state using the federal exchange) have to grit our teeth and hope the bugs get fixed. I'm in a situation where I really need to use the Exchange, so I sit and wait, hoping it's all fixed by December 15 or else I could be screwed. I don't so much mind losing the subsidy (only about $100 a month) but I can't lose the ability to buy the cheapest plan and have no cost sharing (that can mean up to $6000 a year).

 

[rbmrtn]

But what if after the fact your circumstances changed and you are eligible for a big subsidy

I am a perfect example.... last year at this time I would not have qualified for a subsidy or a small one.... but now that I do not work, when I file my tax return I would qualify for a bigger one.... With being able to claim a subsidy or a credit ONLY if you buy through the exchange means that it would not be smart to buy anyplace else except the exchange.... because if you do and circumstances change.... well, too bad for you....

There are qualifying events that allow for special enrollment periods so you could probably enroll at that time.

 

[ziggy29]

There are qualifying events that allow for special enrollment periods so you could probably enroll at that time.

Agreed, if it is triggered by a loss of coverage, loss of spousal coverage, marriage, divorce, childbirth or a few other things. I don't think "significant income change" in and of itself would trigger such an event.

 

[MichaelB]

I found this article discussing why bronze may be the best choice. Essentially now your OOPM really is the max. it includes deductibles/co-pay/co-ins, whereas before they could stack all of those on top of each other.

Bronze May Be the Most Precious Metal Under Obamacare | Hull Financial Planning

Thanks!

But what if after the fact your circumstances changed and you are eligible for a big subsidy

I am a perfect example.... last year at this time I would not have qualified for a subsidy or a small one.... but now that I do not work, when I file my tax return I would qualify for a bigger one.... With being able to claim a subsidy or a credit ONLY if you buy through the exchange means that it would not be smart to buy anyplace else except the exchange.... because if you do and circumstances change.... well, too bad for you....

You don't need to buy a policy on the exchange itself. You can use another authorized source, which includes some agents and insurers. But you do need an ACA compliant policy.

If your circumstances change and you go from "not subsidy eligible" to "eligible", you apply for a subsidy as soon as it happens. If you are currently eligible and think that might change, you apply now for the subsidy, and when your situation changes you notify the exchange to adjust the subsidy based on your new circumstances.

You need a specific criteria to change policy outside of the special enrollment period, but the subsidy can (and should) be changed any time your projected income changes.

 

[ziggy29]

Thanks!
You don't need to buy a policy on the exchange itself. You can use another authorized source, which includes some agents and insurers. But you do need an ACA compliant policy.

Right. But you do need to apply on the Exchange, right? My understanding is that you have to at least apply for (and be approved by) the exchange before you can use these other sources and apply the subsidy.

 

[47]

Thanks!



You don't need to buy a policy on the exchange itself. You can use another authorized source, which includes some agents and insurers. But you do need an ACA compliant policy.

Aren't ALL policies issued after 2014 Jan going to be ACA compliant policies -- except for a very very small subset of grandfathered policies which will go away in under a year anyway?

Could you please site the reference? This is such an important issue it would be helpful for everyone to have the official source.

I always thought this would be the trojan horse which would pretty much force the insurance companies into playing nice in the exchange as all consumers would pretty much buy in the exchange to play it safe.

 

[MichaelB]

Right. But you do need to apply on the Exchange, right? My understanding is that you have to at least apply for (and be approved by) the exchange before you can use these other sources and apply the subsidy.

"The marketplace" I know,, like the MAGI discussion, there are multiple definitions that are confusing us. This one is murkier.

My understanding is you can use the exchange or one of the authorized agents, such as ehealthinsurance.com. They can open the account for you, they submit your info to the healthcare.gov subsidy verification process, get the approval, and issue the policy.

We have one report from a member saying the insurer can do it directly http://www.early-retirement.org/forums/f38/sign-up-now-68998.html#post1373565 . In this situation it's not clear if a marketplace account was opened by him or BCBS. On the other hand, if you know which policy you want, there's no harm in calling the insurer and asking if you can get the subsidy directly through them.

The IRS language is pretty clear, to be eligible for subsidy a policy must be obtained through the marketplace. A FAQ on this would be nice but I haven't found one yet, though not for lack of searching.

 

[MichaelB]

Aren't ALL policies issued after 2014 Jan going to be ACA compliant policies -- except for a very very small subset of grandfathered policies which will go away in under a year anyway?

Could you please site the reference? This is such an important issue it would be helpful for everyone to have the official source.

I always thought this would be the trojan horse which would pretty much force the insurance companies into playing nice in the exchange as all consumers would pretty much buy in the exchange to play it safe.

New healthcare plans must be ACA compliant.

The source for my marketplace confusion / comment is the Federal Register, June 19 2013 http://www.gpo.gov/fdsys/pkg/FR-2013-06-19/pdf/2013-14540.pdf

We propose that ‘‘Exchange’’ would mean a governmental agency or non-profit entity that meets the applicable standards of Part 155 and makes QHPs available to qualified individuals and/or qualified employers. Unless otherwise identified, under the proposed definition this term would include an Exchange serving the individual market for qualified individuals and a SHOP serving the small group market for qualified employers, regardless of whether the Exchange is established and operated by a State (including a regional Exchange or subsidiary Exchange) or by HHS.

KFF interpretation of this rule is Univision Obamacare Deal Could Put WellPoint, Blues Ahead Of Competitors - Kaiser Health News

The rule allows a customer to be sent briefly to a special section of the federal or state-run marketplaces only to see if their income qualifies them for subsidized coverage, and then can go right back to the WellPoint or Blues site to buy their coverage.

It would appear that BCBS Florida is already engaged.

Good to know I'm not the only one confused, so I feel like I'm in good company.

 

[rbmrtn]

Agreed, if it is triggered by a loss of coverage, loss of spousal coverage, marriage, divorce, childbirth or a few other things. I don't think "significant income change" in and of itself would trigger such an event.

A change in income may qualify as it impact affordability

You are newly eligible or lose eligibility for advance payment of the premium tax credit, or you experience a change in eligibility for cost sharing reductions.


Taken from this

PPACA Qualifying Events Beginning in 2014 - KHI Agents

 

[47]

This Univision BCBS deal stinks to high heavens.

This is just swindling, plain and simple which bypasses the entire raison d'etre of an exchange -- head to head comparison shopping -- but still feeding on the public trough.

[mod edit]

 

[rbmrtn]

My understanding is you can use the exchange or one of the authorized agents, such as ehealthinsurance.com. They can open the account for you, they submit your info to the healthcare.gov subsidy verification process, get the approval, and issue the policy.

I think that is the key. The agent/broker is essentially doing the signup for you through the exchange. You are getting an exchange plan but dealing with the broker/agent/insurance company. They have to be approved to work with the exchange.

Here's a HHS memo on the role of agents/brokers in the exchange

http://www.in.gov/idoi/files/agent-broker-5-1-2013.pdf

 

[audreyh1]

I found this article discussing why bronze may be the best choice. Essentially now your OOPM really is the max. it includes deductibles/co-pay/co-ins, whereas before they could stack all of those on top of each other.

Bronze May Be the Most Precious Metal Under Obamacare | Hull Financial Planning

I think for us the availability of Bronze Plans is the true innovation of ACA (we already had deductibles included in max OOP). Before this, all that was available to us was more like a Silver plan, with the corresponding higher premium because it offered low copays for X doctors visits, prescription drugs, etc. These all look preferable on the surface, until you realize you're EACH paying an extra $1200 to $1500 a year in premiums for the privilege!

 

[MichaelB]

I think that is the key. The agent/broker is essentially doing the signup for you through the exchange. You are getting an exchange plan but dealing with the broker/agent/insurance company. They have to be approved to work with the exchange.

Here's a HHS memo on the role of agents/brokers in the exchange

http://www.in.gov/idoi/files/agent-broker-5-1-2013.pdf

Great find! Thanks for another excellent reference. At first glance it answers quite a few questions about the role of the other marketplace players. I'll put it in the FAQ and hopefully will be able to get through it over the weekend.

 

[audreyh1]

New healthcare plans must be ACA compliant.

The source for my marketplace confusion / comment is the Federal Register, June 19 2013 http://www.gpo.gov/fdsys/pkg/FR-2013-06-19/pdf/2013-14540.pdf
KFF interpretation of this rule is Univision Obamacare Deal Could Put WellPoint, Blues Ahead Of Competitors - Kaiser Health News
It would appear that BCBS Florida is already engaged.

Good to know I'm not the only one confused, so I feel like I'm in good company.

BCBS TX website also has a link to go to the exchange to enroll and determine your subsidy, and then return to them to complete the enrollment.

 

[tinlizzy]

For individual plans HSA contributions are not going to be included when figuring a plan's AV. Would this mean, all things being equal with the minimum essential standard requirements (60% for bronze), that the high deductibles in an HSA plan would have to be offset by better benefits somewhere else to get to the 60% AV?

In other words, once you've met the high deductible, the HSA plan would pay out better than the other plans?

Side note - I read that the employer contribution (group plan) to an HSA is included in the AV.

Please correct me if I'm wrong - I'm not sure I have my head quite wrapped around the HSA implications to actuarial value.

http://www.cms.gov/CCIIO/Resources/Files/Downloads/Av-csr-bulletin.pdf

This implies also that cost sharing is even better because a plans AV can be +/- 2%, but the cost sharing must be +/- 1%.

 

[ziggy29]

In other words, once you've met the high deductible, the HSA plan would pay out better than the other plans?

I think you have to run the numbers yourself, as I don't think there's a definite answer to this.

One important thing to remember is that HSA contributions reduce your MAGI, so taking a high deductible HSA-eligible plan could not only get you a larger subsidy if you contribute to the HSA, but also potentially reduce your cost sharing requirements if you purchased an HSA-compatible Silver level plan (Bronze-level plans are eligible for a subsidy but not reduced cost-sharing in the general case).

 

[tinlizzy]

I think you have to run the numbers yourself, as I don't think there's a definite answer to this.

No number running - what I'm thinking is that this would be a given now because of the minimum essential standards.