The Affordable Care Act: Mid 2018 Update

CMS (Center for Medicare & Medicaid Services) came out with 3 reports this month which underscore the problems existing with the affordable care act and the exchanges that serve the public through ObamaCare. The 3 reports are Early 2018 Effectuated Enrollment Snapshot; Exchange Trends Report and Trends in Subsidized and unsubsidized enrollments. Why does it take the government 3 reports to say the plans aren’t working for most Americans and that the government needs to fix it? That would certainly be a good start.

The report claims that the exchanges are failing the public with the high cost of the health plans being offered. It goes on to state that the exchanges have poor performance records up to last year but indicates some improvement has taken place. It still takes too long to enroll someone on the exchange. It should be done in half the time it currently takes. (It takes at least an hour or more to answer all the questions.)

The real issues is the quality and cost of the health plans being offered. They cost too much and don’t offer the coverage people require. Those that are not getting subsidies are considering dropping the plans due to their cost. Not surprising when this should have been apparent long before today. Each market throughout the country can substantiate any of these claims.

So we, the public, keep paying higher prices with fewer healthcare benefits because both sides of the aisle can’t reach a normal agreement that would benefit the citizens of this country. Remember, their coverage is the best money can buy except it’s our money buying it for them.

(And, it’s not the same plans)

Since ObamaCare is not working, perhaps the structure it is built on needs to change? I’m referring to everyone needs to have the same benefits regardless of if they are needed. The most common issue is that each plan must include pregnancy. What if you are past that chronologically, or don’t want children or for any other reason? Guess what, you still have to pay for pregnancy and by the way, pediatric dental and vision, as well. Do you need these benefits? You don’t but you have to pay for them. That increases the cost of the health insurance plans. If this benefit was an option like it should be, many who it doesn’t need would not take it and their cost would be less. That would also apply to the mandates of the individual state that are included in the cost regardless of their use. (This is a totally different discussion best left for another blog.)

Moving to another problem with one plan fits all, suppose you are healthy and never or hardly ever go to the Doctor. Why do you need a fixed copay for a Doctor Visit when going once or twice a year and paying the contracted rate versus a fixed copay would save you a lot of money?
Another option to help lower pricing is to re-think the age band issue. It’s sort of complicated because prior to ObamaCare, the insurance companies figured out how to price. They had 5 year age bands so everyone in the 5-year band would have a rate dependent upon that band. So the 20-24 year age band had a series of rates that worked for that group and so on up the age range. With ObamaCare, those that developed these plans decided that the age bands should 0-20, 21-39, 40-39 and 60-64+. No one checked with the insurance companies to see if it would work. They assumed it would. Then they decided that the 60-64+ age band could not pay more than 3 times the average cost from the 20-39 age band. What happened was the rates for the younger people went up substantially and so did the higher age bands. In fact, the 20-39 age band increase when up about 250% so higher prices could be charged for the older folks because they typically had more medical issues. This issue should have been left to the insurance accuracies who know their business and could have advised the government on how to effectively price the bands.

If that wasn’t enough, last year the ObamaCare administrators decided to change the bands for the younger people, making the band 0-14, then charging more for 15 through 19-year-olds. If they had really thought about it, those between the ages of 15-19 were pretty stable health-wise while new babies born with health defects cost much more than teens health wise.
Yet there too many plans with fixed copays rather than a higher deductible with no fixed copays, so the monthly premium would be less. These are some of the examples of how to lower the cost of health insurance, yet no one is moving in that direction? There are some high deductible plans in each market but the pricing is way off so most don’t take advantage of it.
This issue of affordable health care is a national one, not a political issue but both sides are making it that way. I can only hope that these politicians with no skin in the game come to their senses before healthcare is out of reach economically for most Americans. We are pretty close to that time now and now is the time to do something instead of just talking about it.
I understand that some progress is being made and some new or old ideas revisited are being brought out of mothballs. The main one is association health plans. These type of plans have worked for decades and are now being revisited. This is a step in the right direction but more needs to happen to fix the mess left by ObamaCare.

More to follow as things develop.

Len Barend

The Barend Agency Inc.

702-250-2200

www.insurance4unevada.com

len@insurance4unevada.com 

Comments are closed.