Potential major good news on ACA premiums

[Packman]

That's what I am seeing as DH starts Medicare this fall.

However the impact is somewhat lessoned as we use bronze plans and the % is based on the second lowest cost silver plan.

Doesn't seem right that two people pay the same price as one.

 

[GLM]

Doesn't seem right that two people pay the same price as one.

It's not right , but they wrote the law in a hurry and there are glitches, like the family glitch.

 

[zinger1457]

OK...DH is retiring this year; I have 2 yrs. I will keep our current insurance as our 2 youngest can still be on it.
I believe our BC/BS retirement rate is about $1100/mo. after the kids drop off (we expect that in 2 years). Our deductibles aren't too bad. (sry, exact numbers escape me)
If there is an 8.5% cap, that puts us at under $650/mo--but what kind of deductibles could we be looking at?
We have had BC/BS our whole lives with zero issues. Are ACA providers as good to work with?

You can check the ACA plans available to you here, https://www.healthcare.gov/see-plans/#/. The cost ($650/mo) you calculated is based on selecting the second lowest cost silver plan available to you. Your cost could be less than that if selecting a Bronze plan or more if selecting a higher cost Silver plan with lower deductibles. At my location I have 16 Silver plans to choose from, the plans with a very low deductible are pricy. Also, the 8.5% cap is only guaranteed to last through 2022, I'm sure they will try to extend it but....

 

[anothercog]

When does this take effect? Just priced some plans on Covered California, assuming a May 1 start date for a family of 5 and 200k income and cheapest I'm seeing for a Silver Plan is an HMO for over $3k/mo with a $8k family deductible. If I want a PPO, it's $3,900/mo.

That's 18%+ MAGI. Ouch!

 

[copyright1997reloaded]

.

The thing the ACA tried to do is to add an extra charge the healthiest customers' premiums and use that overcharge to subsidize other customers' risk premiums. In the term insurance example, it would be like the 25YO being overcharged and the 65YO being charged less than his risk calculation would call for. Much of this discount was due to accepting customers with preexisting conditions without making those customer pay the real cost of their insurance. There really is a free lunch for those folks. The actuarially healthier folks at the next table paid. Or at least that was the plan.

Now you can argue whether this kind of cross-subsidy is desirable or not but the fact is that the cohort that the government planned to overcharge figured out the scam and refused to play the game.

Bingo.

And this is the reason why, without a true enforcement of the mandatory enrollment, that the plan was doomed for failure -- and I might add predicted by people like myself.

Self-selection bias. If the people are able to choose whether to enroll or not-enroll, then the results are that those who are "sicker" will enroll, and those who are not won't. This results in higher payments out of the $ paid by premiums than expected, which results in higher premiums, which results in those who are "really sicker" staying in the plan while those who are "only a littler sicker" dropping out (due to increased premiums), and the non-virtuous cycle continues.

This can be seen prior to the ACA in states that had "community rated" plans and disallowed exams/checks for pre-existing conditions. (As an example, NY was this way). Yes, anyone could get a plan but the costs were much higher - and if you were a healthy 25 year old would you pay $800/month for health insurance? For many, the answer was no.

 

[RetiredAt55.5]

In most states BC/BS is one of the major ACA providers. Unfortunately, ACA plans generally have big deductibles compared to corporate/COBRA plans.

Anyway, you need to shop your own state's marketplace to see what's what.

Yes, you need to shop since what's available varies a lot for different states and even regions.

Our Silver plan, e.g., has a $0 deductible and is a BC/BS. But, the copays are relatively high - $40 to see our primary and $80 to see a specialist.

My old corporate plan had a $1,250 deductible.

 

[Time2]

I'm from the government and here to help. What could go wrong.

It will be great, Well, unless you are the tax payer.

 

[ncbill]

It will be great, Well, unless you are the tax payer.

Yep, we now have four major health systems where most or all costs are paid by taxpayers...Medicare, Medicaid, VA, ACA...wonder how much costs could be squeezed if you simply combined them all...most national public health services operate like our Medicaid anyway.

 

[Time2]

Doesn't seem right that two people pay the same price as one.

The part that doesn't seem right to me, is that we are subsidizing a family of 2 making $70K a year and a family of 4 making $104k. I thought it was poor people that needed help.

 

[MichaelB]

The single biggest tax benefit the US Government provides is the health insurance tax break for employed people, and the highest income employees earn the greatest benefit. This is never mentioned when people complain about a benefit others receive.

The median household income in the US is around $69k, and the average cost of large group family health insurance is $21k. Before tax, that’s almost 1/3, before payroll and income tax. Health care insurance is unaffordable for middle income working families, and they only get it at all because it’s paid by the employers.

 

[PaunchyPirate]

The part that doesn't seem right to me, is that we are subsidizing a family of 2 making $70K a year and a family of 4 making $104k. I thought it was poor people that needed help.

I'm very open to alternative ways to dealing with the health care situation in this country. But I also don't think it's right that a family of 2 making $70,000 should have to pay $14,400 in health care premiums + the additional costs of deductibles $7600 + the additional costs of prescriptions. These numbers are from my county. And my county does not seem to be the most expensive (by far) for medical care in this country.

That is more than 20% of their income -- just for the premiums.

Solve the problem one way or another. It's a problem.

 

[garyt]

All this arguing over the ACA and in 2020 only 8 Million people signed up.
The numbers has been in decline since 2016, and we are getting closer to the actual number of people that needed real help, although clearly not there yet, there are still people with 100s of thousands of dollars and even a million dollars still an the ACA. So now to make it look better, (bump the numbers), the government is giving it away for free? It would have been much better to actually take care of those that needed it. As it is now, the poor are asking where am I going to get $16,300 for my family deductible.

Most silver plans for "poor" people ( a couple making $25,000 a year) have $700 deductibles and max OOP of $1800-$1950 far, far, from $16,000. This is in Mi.

 

[ncbill]

The single biggest tax benefit the US Government provides is thebhealth insurance tax break for employed people, and the highest income employees earn the greatest benefit. This is never mentioned when people complain about a benefit others receive.

The median household income in the US is around $69k, and the average cost of large group family health insurance is $21k. Before tax, that’s almost 1/3, before payroll and income tax. Health care insurance is unaffordable for middle income working families, and they only get it at all because it’s paid by the employers.

Your implicit assumption is that the employer still pays all costs...maybe that was true 20+ years ago but not today.

OTOH, for the 4 public systems I mentioned taxpayers do indeed bear nearly all the costs.

Which will only increase with the likely permanent end of the ACA cliff and even more so if "Medicare at 60" happens.

 

[GTFan]

Oh look, another ACA bashing thread! Porky on the way...

 

[MichaelB]

Your implicit assumption is that the employer still pays all costs...maybe that was true 20+ years ago but not today.

OTOH, for the 4 public systems I mentioned taxpayers do indeed bear nearly all the costs.

Which will only increase with the likely permanent end of the ACA cliff and even more so if "Medicare at 60" happens.

On average, for the year 2020, the large group policy costs $21342, the employer share was $15754, the employee share was $5588. Unseen here is the tax subsidy, the single largest tax expenditure item in the US Gov’t budget.

Most of the costs of the ACA are not paid by taxpayers. Medicaid yes, VA yes, Employer provided, partly. Medicare, it’s paid by govt only if you don’t consider the years of contributions from payroll taxes.

The only people in the US that pay full unsubsidized price for health insurance are ACA users who can’t deduct and receive no subsidy. Less then 5% of the US population.

Getting back on topic, this is a measure directed toward the few people that aren’t getting help, or enough help, to afford health care insurance.

 

[Stormy Kromer]

On average, for the year 2020, the large group policy costs $21342, the employer share was $15754, the employee share was $5588. Unseen here is the tax subsidy, the single largest tax expenditure item in the US Gov’t budget.

Most of the costs of the ACA are not paid by taxpayers. Medicaid yes, VA yes, Employer provided, partly. Medicare, it’s paid by govt only if you don’t consider the years of contributions from payroll taxes.

Getting back on topic, this is a measure directed toward the few people that aren’t getting help, or enough help, to afford health care insurance.

Thanks for pointing this out. I'm in the 5% mentioned. I have purchased my own private health insurance since 1985. I have never worked for an employer who offered health insurance. Currently I'm in the state exchange paying over $16,000 for a Bronze plan. I'm just a few thousand over the cliff, so I'm paying 100% of the premium with AFTER tax income. Over 16% of our MAGI. So, this legislation may not help a lot of people, but it does help some.

For those under an employer's plan, your contributions to the plan are with pre-tax dollars, and the employer's contribution isn't taxed at all. I think that's the point being made.

 

[erkevin]

I'm very open to alternative ways to dealing with the health care situation in this country. But I also don't think it's right that a family of 2 making $70,000 should have to pay $14,400 in health care premiums + the additional costs of deductibles $7600 + the additional costs of prescriptions. These numbers are from my county. And my county does not seem to be the most expensive (by far) for medical care in this country.

That is more than 20% of their income -- just for the premiums.

Solve the problem one way or another. It's a problem.

Thanks Paunchy: we are in that group. Wife and I, retired (not close to 65), income is about $80,000 per year. Our Bronze plan is over $16,000 per year. Deductible is $17,000

 

[Markola]

Thanks to this thread, I was inspired today to go through the sign up process on MNSure.org, which is the ACA exchange in Minnesota. It appears that the website is not ready to deal with the changes from the American Recovery Act. If any Minnesotans have found differently, please advise or PM me. I signed up for news alerts from the site.

 

[scrabbler1]

The New York State of Health (New York's exchange) announced how it is handling the ACA's expanded subsidies.

https://info.nystateofhealth.ny.gov/AmericanRescuePlan

Here is its intro:

"The American Rescue Plan, which was signed into law on March 11, 2021, will lower health care costs by providing new and expanded financial assistance to New Yorkers enrolling in health insurance through NY State of Health. This enhanced assistance is available to current enrollees and new enrollees, including to higher-income individuals for the first time. Starting in early April, individuals with low and moderate incomes can access higher tax credits. Starting in June, NY State of Health will apply these higher tax credits to current enrollees without requiring any action by the enrollee. Also in June, higher-income New Yorkers can access the new tax credits."

 

[jim584672]

Good to know. I was supposed to go to the Essential Plan but they locked everyone in Medicaid until the pandemic emergency is over.

 

[Montecfo]

In my opinion way too much effort has been spent subsidizing health care and not enough effort spent addressing and reforming health care to make it more cost effective and affordable.

 

[ownyourfuture]

In my opinion way too much effort has been spent subsidizing health care and not enough effort spent addressing and reforming health care to make it more cost effective and affordable.

Thank You
I was beginning to wonder if I was the only person who felt that way.

 

[Markola]

I hope the mods can keep this string open, so we can share perspectives on these new, potentially game-changing health insurance provisions for early retirees.

 

[Aerides]

To keep this helpful thread on track, let's stick with the matter at hand, which is the new changes and ways members can navigate them. Not opining on the basic principle of whether you agree with the ACA as a whole.

 

[erkevin]

healthcare.gov is up and running. Re-applied this morning. It worked and I received a subsidy.