Sticker Shock' Ahead on Health Insurance

[mikesimon]

'Sticker Shock' Ahead on Health Insurance
By David Pittman, Washington Correspondent, MedPage Today
Published: February 05, 2013

WASHINGTON -- Separate surveys released this week give dramatically different outlooks for two groups of people under the Affordable Care Act (ACA): the young, healthy worker and the part-time worker.

Premiums for a healthy, nonsmoking, 27-year-old in a "bronze" -- or relatively inexpensive -- small-group or individual policy would increase on average by 169% in five markets in 2014, a survey of major health insurers by the conservative American Action Forum (AAF) found.

Meanwhile, premiums for an unhealthy, 55-year-old smoker in a more generous gold-rated policy would decrease by 22%, on average, in those same five markets in 2014.

"The results surveyed above indicate that there will be massive sticker shock to the relatively young and healthy in both the small group and individual markets," the AAF report said. Those increases essentially subsidize the ACA mandated coverage of sicker individuals and limits on variations in premiums between groups of insured such as men and women, the report noted.

ACA mandates coming in 2014 include the mandate for individuals to purchase insurance; minimal coverage requirements for insurers; coverage of pre-existing conditions for adults; limits on premium variation based on age, gender, health status, or group size; new fees and taxes; and other new rules.

The AAF sought to understand how these changes would play out in different markets. It sent a survey to an unspecified number of major insurers and asked them to forecast the ACA's impact on small-group and individual plans in six cities.

Results showed premiums would increase for young, healthy individuals by an average of 190% in Milwaukee and 157% in Phoenix -- the city with the lowest increase for the group.

To put a dollar amount on that, the average current monthly premium in Chicago, Phoenix, Atlanta, Austin, and Milwaukee is $2,047 for young, healthy workers in a small-group plan. The AAF survey found it will jump to around $5,124 in 2014 with the ACA changes.

However, premiums would drop 32% for older, less healthy individuals in Austin, Texas, the largest drop for the surveyed cities, and by 15% in Milwaukee, the smallest drop for a city.

Premiums for older, less healthy workers in a small-group plan in those same five cities would drop from $14,534 today to $10,706 next year, the AAF survey found.

Both groups of enrollees would be helped economically in some cases by federal tax credits available for those making between 100% and 400% of the federal poverty level, if they purchased insurance through a health insurance exchange.

"By eliminating or constraining these 'rating factors' that result in the variation in today's market, the ACA in 2014 increases the premium for the young and healthier and lowers the premium for the older and sicker," the AAF survey said. "The same would be true if there were a law reforming automobile insurance."

The AAF survey didn't specify which health insurers participated in its survey but did say it wouldn't have published results without at least four respondents for each city. Albany, N.Y., was the only city it asked about whose results weren't published.

A separate survey from the ADP Research Institute, also released this week, says the ACA's penalties for employers to offer coverage to employees could result in more of today's part-time workers receiving coverage.

"The shared responsibility provision of the ACA may result in employees who are currently classified as part-time being reclassified as full-time, meaning the employer must offer coverage to those employees or face a potential penalty," ADP's 2012 Study of Large Employer Health Benefits said.

In 2012, 23% of all employee positions were classified as part-time and only 15% of those were eligible for benefits, the survey found. The survey was based on roughly 300 companies with at least 1,000 employees.

The ACA mandates that any employee working at least 30 hours per week, or 130 hours per month, must be offered employer-sponsored health coverage that meets certain requirements if the business employs 50 or more full-time workers.

"The ACA will require employers to extend health coverage to more part-time employees, and employers need to carefully consider the best approach for their organization," the report stated.

On Monday -- the same morning the AAF released its survey -- Health and Human Services Secretary Kathleen Sebelius said the government must reach out to young people currently uninsured who may not know they can gain federal assistance to buy coverage through a health insurance exchange or marketplace. Young people are particularly tough to reach, she noted.

"If we're going to fulfill the full promise of the Affordable Care Act and insure millions of Americans, we need to reach these people," Sebelius said Monday.

http://www.medpagetoday.com/Washington-Watch/Reform/37205

[teko]

Thankyou, and you are right,  children with pre existing has been a problem as well but I think as of last year? Under obamacare your insurance can no longer hold pre existing against children.Nor can they put caps on the care they get.  I think it is next year for adults, I think. I think the only thing the ACA is doing is providing pools so that more people can have health insurance and in order to make that possible everyone has to carry it. The more that carry, the cheaper it will become. hopefully. lol At least this is the theory.

I still think we are heading to universal tho, eventually.

[teko]

I still see this as the "haves and have nots".  If you have money, you'll pay dearly... if you have little money.... don't sweat it.  Everyone else is paying.


Education is in order here. It may be an opinion, but its way far from the truth.

[teko]

Bricey, Now go back, and re read the thread. You truly do only hear what you want to, dont you? Might that be one of the problems with the board. Lack of reading skills?

Luv u too bricey!

[R Glass]

I think our mistake was we “Threw the Baby out with the Wash” after “Hillarycare” was canned. I’m not trashing H. Clinton but her plan was so poor, it didn’t even get the support it needed from fellow Democrats. Some of them even tried proposing their own plan. Finally the White Flag went up and the only time Health Care was mentioned was during campaigns. Now we have a plan at a time we cannot afford it and no one truly understands it. If our leaders had been working on it since Hillarycare was defeated and slowly introducing pieces of Healthcare into legislation, by now we would probably have the best Health Care System in the World.

[brice1967]

Dear teko,

I am sorry that you took offense to my opinion on health care and how and who will be paying for it.  I was under the impression that this was a place where one could voice their opinions on such matters, but it appears that you have changed the rules of the game.  (We've got some pre-existing conditions here...we've got insurance...)

"And I will only add that altho you may pay premiums, lets remember you get that cost because you belong to a pool of people making it possible for you to get that rate, and when you go to the doctor there is an agreement between your insurance company and the provider of that cost of service."

I take offense to the paragraph above.  I chose to go to work for a company that provided insurance.  You chose not to.  That is one of the side bars to being an entreprenuer, such as yourself.  You get to pay for health insurance on your own.  I chose not to and you're going to take offense to that?  I mean, you must have had the chance to work for someone who provided medical insurance at some point in life, right?  Did that offend you?

You should quit taking offense to things that people put up on CE, for discussion.  It's not much of a discussion if teko and co are the only ones who can make a comment.... unless of course this is a private board.

Love,
bricey

[Dee1956]

Thank you for the article, really makes me now grateful for what I have instead of what I don't
Dee