The great author and motivational speaker Zig Ziglar used to say he read the Bible and the National Enquirer every day, because he had to know what both sides were doing. When we read stories about the Affordable Care Act, we need to know both sides of the story.
One of the “stories” is people are paying less for their health insurance then they were prior to new law being enacted. This one I find interesting. We know insurance premiums went up in 44 states. Some of the more affordable plans have a smaller network of doctors. The lowest priced Bronze level plans does not have adequate coverage for prescriptions for some people’s needs. When the 2015 rates came out, the increase was less than expected. This was because the rates have to be filed for the following year early, around June. The insurance carriers only had six months of claims history to project their rates for the following year. We also know insurance deductibles and out of pocket maximums went up with it. So insurance costs more than it did prior to the law. Many Americans qualify for what is called an Advanced Premium Tax Credit, otherwise known as a subsidy. Depending on your income, you may receive a subsidy, so you may be paying less even though the premium is higher. Since deductibles and out of pocket maximums are higher, even though you may be paying less, if you spent significant time in the hospital, it could cost more. Insurance carriers are now submitting their rates for 2016. They now have over a year’s worth of claims analysis. Blue Cross Blue Shield of New Mexico has filed for an increase of 51% In Tennessee, Blue Cross Blue Shield are asking for 36%. In Georgia, an insurance company is asking for 64%.
Another great debate is more people have insurance now than before the Affordable Care Act. This debate has no easy answer. The uninsured rate has fallen, but so has the unemployment rate. According to a recent Rand Research study, the largest gain in health insurance was in the employer market. 9.6 million Americans obtained employer health insurance. Is that an affect of the law or the economy improving? The expansion of Medicaid also contributed to the uninsured rate. Some people question whether this should be counted or not. Medicaid is coverage provided by the state. It is not really insurance, as there is usually not an insurance carrier. The State reimburses doctors and hospitals, but not at a rate as good as insurance companies do. Not every state chose to expand Medicaid. Those who are new Medicaid recipients are counted as insured. It is estimated that about 6.5 million Americans were added to the Medicaid system. More people have enrolled in expanded Medicaid than through the health insurance marketplace. Between the Marketplace (health insurance exchange) and those who purchased off the Marketplace, a total of those gaining coverage was 5.3 million. The Congressional Budget Office (CBO) now estimates that between 29 and 31 million Americans will remain uninsured ten years from now.
Many of the supporters of the law still profess that the ACA plans are more robust than the previous plans. I have not heard the proponents actually support these claims. The ACA plans focus on preventive care. The supporters say they have “free” preventive care. As we learned when we were kids there is no such thing as a free lunch. The cost of free is built into the premium.
All health plans now have to have what are called Essential Health Benefits (EHB’s). Most of the plans prior to the ACA had many or all of these benefits, though not necessarily required by law. Some of the others like mental health coverage or maternity varied by state. Many were optional benefits offered by the carrier. One that has been enhanced was the preventive care benefit in all plans is offered without co-payment or deductible as previously mentioned, I would not say free.
While enhancing the essential health benefits is a nice idea, it comes with a premium. The more you require a plan to cover, the more it adds to the premium. The new ACA plans have higher deductibles. In many cases, they are twice as high as they were so you are more vulnerable at the time of claim. To try and offset the increasing costs, many carriers have shrunk their network of doctors and hospitals. The idea here is to pay them less per service, but drive more volume to the facility. So the thought that you could keep your doctor, may or may not be accurate. Many people have been forced to change doctors, or change insurance carriers.
Lastly, the Wall Street Journal cited a study from Moody’s Investors Service showing that non-profit hospitals in the states that expanded Medicaid, are not seeing more unpaid bills and more paying clients. Seeing more Medicaid patients and lower reimbursements does not make up for the reduction in reimbursements under the law. If hospitals have to go out of business, it won’t matter how many Americans have insurance.
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