Puzzling premium prices on private exchange

[MBAustin]

My former employer has switched retirees over to a private exchange (administered by Aon Hewitt) this year. There are 3 carriers (Aetna, CareFirst BCBS, and United Healthcare). There are Bronze, Bronze Plus, Silver, Gold, and Platinum choices for each. (I don't think these are exactly the same as the terminology on the ACA exchanges, but the idea is similar.) The Bronzes and Silver are HSA eligible.

The curious thing is that the premiums for the Aetna plans are double BCBS and triple United although the coverages are nearly identical. In fact, the Aetna Bronze plan is significantly more expensive than the United Platinum plan.

Two questions:
- Has anyone else seen similar patterns on a private exchange?

- If my doctors are in network and it looks like there is a reasonable selection of specialists, is there any reason not to go with United Healthcare?

Thanks in advance!

 

[MooreBonds]

The curious thing is that the premiums for the Aetna plans are double BCBS and triple United although the coverages are nearly identical. In fact, the Aetna Bronze plan is significantly more expensive than the United Platinum plan.

I think Mulligan was looking to purchase coverage off of the exchange.

While there can be some variability, if you're seeing the pricing above where the United Platinum is cheaper than an Aetna Bronze, I would triple check ALL of the fine print. Sounds almost too good to be true! Either the family deductible is different, or the drug coverage forumulary is different, or the co-insurance is different, etc.....(or a combination of 2 or more). I would bet that SOMETHING is making the two plans very different in terms of benefits.

 

[Katsmeow]

In addition to the possibility MooreBonds mentions...

It might be worth asking the employer directly to find out what they would say. It is possible that it is as simple as them wanting to offer 3 different carriers and those 3 were the cheapest even though Aetna isn't cheap.

Another possibility is that Aetna has previously been a carrier for the company so they want to continue offering Aetna although not cost competitive.

Do you know if the coverage on this is funded by the former employer? I

While your doctors may be in both plans, is one network broader than the other network? Also what about hospital choices, does one plan have broader choice of hospitals?

 

[RetireBy90]

Another possibility, I've read that with the Obama care exchange, some companies are pricing cheaply to get market share in specific markets. Perhaps United is trying to get some market share in your specific location?


also reported, some companies will come in low to get some market share, then jump prices the following year playing on the fact that many will stay with the same company even with price increases. Think of car insurance. How many just keep coverage with the same company year after year, compared with how many do a market check each year to see who the best value is this year.

 

[Senator]

Look at the ability to travel and get care in out of networks costs.

 

[MichaelB]

This year I saw a sort of hybrid plan offering which was called a PPO but had elements of POS / EPO. The network has tiers, the lower tiers are more costly to the policyholder, the higher tiers require a PCP and prior authorization. Same with the drug formulary. This is being offered by UHC in Fl, and is easy to miss when reading the literature.

Aside from that, pricing is derived from the insurer's estimate of the total cost of the policy. If the policy is less expensive it's because the insurer projects it will pay out less in benefits. The "metal levels" have a specific meaning for ACA compliant plans and nothing outside that.

You absolutely must read and compare the summary of benefits and list of exclusions in each policy, and they must be "ACA compliant".

 

[MBAustin]

Thanks, everyone, for the good information and things to look for. I'm making some progress and have basically ruled out Aetna at this point as ridiculously expensive since all of my doctors are in-network for both BCBS and United Healthcare. So now I'm comparing the specific plans.

Another possibility is that Aetna has previously been a carrier for the company so they want to continue offering Aetna although not cost competitive.
Interesting - Aetna has managed their self-insurance program for many years so I bet this is why they are included even though not competitive.

Do you know if the coverage on this is funded by the former employer?
They are subsidizing a fixed amount per month. It's actually enough to more than cover several of the plans, which I did not expect since I had been paying more than $300/month under the previous system.

While your doctors may be in both plans, is one network broader than the other network?
I've done a number of searches for both BCBS and United and they both seem to have a pretty comprehensive list of doctors in all the specialties I've checked. It does look like I'll need to go to a different radiology facility for my annual mammogram, but there are a lot of choices. Ditto for laboratory. Neither is a big deal for me.
Also what about hospital choices, does one plan have broader choice of hospitals?
There are only 2 major hospital groups in the area and they both look to be in network.

Another possibility, I've read that with the Obama care exchange, some companies are pricing cheaply to get market share in specific markets. Perhaps United is trying to get some market share in your specific location?
This could be a possibility. I wasn't aware of them being a big player here up until now.

also reported, some companies will come in low to get some market share, then jump prices the following year playing on the fact that many will stay with the same company even with price increases. Think of car insurance. How many just keep coverage with the same company year after year, compared with how many do a market check each year to see who the best value is this year.
This does concern me somewhat, as changing insurance is a pain. Which is why I'm comparing both BCBS and United and not just going for the cheapest.

Look at the ability to travel and get care in out of networks costs.Both BCBS and United seem to offer comprehensive national networks. I checked the small rural town in MD where we have a summer house as well as NYC where DD lives and there are plenty of in-network providers in both areas.

This year I saw a sort of hybrid plan offering which was called a PPO but had elements of POS / EPO. The network has tiers, the lower tiers are more costly to the policyholder, the higher tiers require a PCP and prior authorization. Same with the drug formulary. This is being offered by UHC in Fl, and is easy to miss when reading the literature.
The network for the BCBS plans is called "BlueCard PPO/EPO" but all the documents I've found so far make it appear to be a normal PPO (they do offer out-of-network benefits). I see on the UHC provider directory that some doctors are called "UHC Premium Tier 1" (which seems to be a good thing) but there is no reference to this in the plan documents for what employer is offering.

...

You absolutely must read and compare the summary of benefits and list of exclusions in each policy, and they must be "ACA compliant".
They are all "ACA compliant". Still working through all of the benefits comparisons in detail.

 

[MichaelB]

The BCBS PPO plans offered on the exchange in Florida are all called "PPO/EPO", and the documents say "EPO". After many phone calls, my conclusion is they are really PPO plans for the essential health benefits and coverage that an individual adult is purchasing. They also included mandatory pediatric vision and dental coverage, those components are EPO-like and limited in scope, which forces BCBS to refer to the plans as EPO, There's no doubt the BlueCard PPO is their premier network.

 

[Katsmeow]

Do you know if the coverage on this is funded by the former employer?

They are subsidizing a fixed amount per month. It's actually enough to more than cover several of the plans, which I did not expect since I had been paying more than $300/month under the previous system.

What I really was asking was if the employer self insures. With health insurance, often the employer is actually the one paying the claims (well it comes from the insurer who bills the employer). There may be some stop loss coverage where the insurer pays once claims exceed a certain amount, but otherwise it is self funded by the insurer and the "insurer" is really just managing the claims more than anything else.

 

[tryan]

some companies will come in low to get some market share, then jump prices the following year playing on the fact that many will stay with the same company even with price increases.

This speaks to why many are dumping thier carrier after 1 year. ACA says you can't be denied ... so chase the lower premium. They raise the rate ... case to the next lower carrier.