Martha said:
I just think people like to know other people's backround to evaluate where they are coming from. Our culture at this forum favors those who tell a little about themselves before jumping into discussions. But I do appreciate that you have kept the discussion civil. You and I will probably disagree consistently as to the effectiveness of the "free market" and the need for a safety net. Nevertheless, values and politics aside, it is helpful to have an insurance agent participate in the health care discussions as you may have information regarding underwriting and cost (at least for Colorado) that is not readily available.
Martha,
In the state of Colorado, there are three main reasons why employer-sponsored benefits are twice as expensive as individual plans.
1.) They are guaranteed issue - Anyone with any health history can qualify without pre-existing condition limitations.
2.) Maternity coverage is mandated whether you need it or not.
3.) Adverse selection - Since prices are so high, the healthy tend to drop out of the group market leaving a large number of unhealthy people in the risk pool.
I read the Healthy Americans Act, and it has good intentions except for the following negative consequences:
1.) As you stated before, it doesn't address what happens to the unemployed. Since the unemployed might still have to have an indivdual plan, you can't eliminate individual products from the market.
2.) I don't think community rating is going to make the pricing that much better in the group market, because pricing already reflects guaranteed issue coverage and mandated maternity coverage, and community rating is not going to change that..it might bring the premiums down a little, but I don't believe it will be a significant difference. Sure, you take adverse selection out of the mix, but pricing will still have to take into account guaranteed issue and guaranteed maternity coverage. Therefore, you may be FORCING a large number of people to pay for coverage that they don't want, when they could have bought a cheaper plan on their own.
Why do I say this? Because currently, many small employers don't pay more than 50% of the employee's premium so SOME employees can still buy individual coverage for less than their half of the premium costs in the group market (especially if the employer only offers one plan choice and that plan happens to be a high-end plan). Are we going to FORCE employers to now pay 100% of the employee premium as well as 100% of the premiums for their dependents? If not, then are we going to FORCE all Americans to pay more for their dependents than they could have paid in the individual market? A lot of my clients save a fortune right now by placing their one or two healthy children on an individual plan vs. paying the difference for the family rate on a group plan.
3.)The "Standard" plan is a pretty rich plan, and compared to many other types of plans (high deductible, etc..., it is pretty pricey. If I am healthy, and I don't need such a rich benefit, why should I be forced to buy into it? Granted, my employer might pay 50% of the premiums for my coverage but my half might still be more expensive than an individual high deductible policy might be.
These are just some of my thoughts....my opinions...